PERTH, Mar 08, 2012 (Dow Jones) -- Rio Tinto PLC's (RIO) iron ore chief executive, Sam Walsh, said Wednesday that he expects China to remain a key driver of iron ore demand growth, despite recent signs the Chinese economy is slowing.

"We believe there can be very little doubt about China's continuation as the prime driver of world growth for iron ore over the longer term," Walsh said in Perth.

The Chinese economy is "displaying signs of slowing, and the impact of western economy troubles will contribute to that", he said.

Earlier this week China moved to cut its gross domestic product forecast to below 8% for the first time in several years.

Analysts have said the target's adjustment--to 7.5% growth in 2012, and a five-year average goal of 7%--may prompt a longer-term decline in China's demand growth for commodities, including iron ore.

Commenting on the revision, Walsh said: "Most countries around the world would jump for joy if they could achieve 7.5% growth."

China is "resilient," Walsh said, as it is equipped to underline its growth with fiscal and monetary changes and has increasing rates of household and corporate savings.

The country's crude steel consumption is forecast around 1 billion metric tons by 2020, representing just under half of forecast world consumption, he noted.

"China's central and western cities are following similar paths to their eastern counterparts, with populations shifting from rural to town and city areas," Walsh said.

Turning to the shortage of labor skills in Australia because of the China-driven mining boom, Walsh said it has been estimated that an extra 30,000 employees will be needed in Western Australia state's resource sector over the next year or two.

Rio Tinto alone is looking to "hire around 7,000 people over the next two years" to take its Western Australian workforce to roughly 17,000, he said.