Business Support Integrated Australia-NZ Market

Business Support More Integrated Australia-New Zealand Market

A strong case exists for New Zealand and Australian business leaders to ask respective governments to “bite the bullet” on removing remaining impediments to a truly single trans-Tasman market.

For New Zealand business, a ‘call to action’ is required to bring our tax system and rates more into line with Australia’s, said Michael Barnett, chief executive of the Auckland Chamber of Commerce. He was commenting on a New Zealand Institute of Economic Research report titled ‘Stepping Towards a Borderless Market?’ released in Sydney today.

The closer economic relations (CER) agreement has been a major success for both Australian and New Zealand businesses, the report says. Freer trade across the Tasman has in the past 20 years improved consumer choice and lowered cost, increased business opportunities, salaries and wages, and has had a “raising all boats” effect on economic growth of both economies.

However, the report identifies a range of issues holding back trans-Tasman businesses from meeting their full potential in respective markets. They include divergent tax systems and their impact on investment, recent migration laws, ad hoc air rules and internal regulatory arrangements in each country that take no account of the CER relationship.

The NZIER report says that setting up a single trans-Tasman body to govern competition law for goods and services in both countries is a key initiative required to help New Zealand and Australian businesses lift their success in each other’s country.

Mr Barnett: “As the smaller partner in CER, New Zealand needs to be very focussed and strategic in seeking a more integrated trans-Tasman market.”

“The more tidy and coherent we can get the CER arrangement, the more logical it will make the case for both countries to move together into a free trade arrangement with the United States,” he suggested.

“Of course, Australian self-interest is at the heart of their negotiation of a free-trade agreement with the United States. But with CER also extremely important to Australia’s business community, there is a compelling logic for Australia to conduct its free trade negotiation with the United States in a way that is consistent with the trans-Tasman template.”

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