BHP confident can seal JV with Rio

"It is imperative that the impact of any policy and tax changes of governments around the world on sectors of economies should be well understood and do not hinder investment and the capacity of economies to grow," outgoing Chairman Don Argus said in a farewell letter to shareholders on Thursday.

Australia is set to release a comprehensive review of its tax policies soon, and reports in January said it would suggest replacing state-based royalty taxes with a national resource rent tax, likely to be set at 40 percent.

Argus added the company believed it could seal its iron ore production joint venture with Rio Tinto this year, which will call for BHP to pay Rio Tinto $5.8 billion (3.79 billion pound) to equalise their stakes.

The deal needs approval from the European Union, which raised concerns two years ago when BHP proposed a full takeover of Rio Tinto. The deal was abandoned in the heat of the global financial crisis.

Argus reiterated the group was uncertain about the economic outlook, pointing to the stark contrast between the strong growth prospects for developing countries and weak growth expected in rich countries.

"We do remain cautious about the state of the global economy and note the recent International Monetary Fund (IMF) report which highlighted the gap in growth between developed an developing economies," Argus said.

New chairman Jac Nasser, an ex-chief at Ford Motor Co , takes over on March 30.

(Reporting by Sonali Paul; editing by Balazs Koranyi)