Perth has the capacity to be an international mining and LNG hub but should also diversify, says the mayor of the city regarded as the world's energy capital.
Houston mayor Annise Parker, who is in Perth, said one lesson her city could teach Perth was to be "adaptive, creative and prepared for any outcome".
Asked about pitfalls to be avoided that Houston faced as it became an energy capital, Ms Parker stressed diversification.
She said Houston was not unfamiliar with hard times, though it had a "healthy share of good times", especially compared with the rest of the US.
But a problem with having a "strong economic engine" was sometimes that one industry was relied on too much.
Much of Houston's economy was tied to energy and though it had diversified its base significantly, global energy downturns tended to cause "large ripples".
Houston found diversification did not need new areas of activity. It began to nurture high-tech medical and space research and found "significant synergies" with the city's core strengths through engineering, new material science and manufacturing.
Ms Parker is in Perth for the 30th anniversary of the Houston-Perth sister city relationship.
Lord Mayor Lisa Scaffidi, who will visit Houston in November, said Ms Parker's visit was an opportunity to recognise the benefits of the relationship and look to future opportunities from it.
Ms Parker sits on a range of US boards and panels and was in Time magazine's 100 most influential people in 2010 and 2011.