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The relationship is supported by “the world’s most comprehensive, effective and mutually compatible free trade agreement”, which is constantly updated and modernised. There is substantial political ambition to further liberalise the relationship for the benefit of both countries.
The foundations for the current extensive trading relationship are contained within the Australia New Zealand Closer Economic Relations Trade Agreement (CER). Both countries have worked hard to ensure that the trans-Tasman trading structure is kept modern and liberal, with many successive expansions to the original CER Agreement, and more recently through the ambitious drive toward a trans-Tasman Single Economic Market (SEM).
When CER entered into force, it provided for the scheduled elimination of tariffs and quantitative restrictions on goods by 1995. This was a far-sighted undertaking at the time, but such was the momentum and success of the agreement, and the degree of mutual trust between New Zealand and Australia, that free trade in goods was in fact achieved in 1990, five years ahead of schedule. Since 1990 there have been no tariffs or quantitative restrictions on goods trade.
Today the two-way trade in goods between Australia and New Zealand is worth over $18 billion per annum and is continuing to grow. Both countries consistently feature amongst the other’s top trading partners.
Free trade in nearly all services was achieved under the 1988 Services Protocol allowing New Zealand and Australian service providers access to each other’s market on the basis of national treatment and a “negative list” (i.e. all services were included unless specifically excluded). Those exclusions are reviewed regularly, and have been substantially reduced: New Zealand maintains two inscriptions (airways services and coastal shipping), and Australia six (air services, broadcasting and television (x2), third party insurance, postal services, and coastal shipping).
New Zealand and Australia share a joint system of food standards, which is served by Food Standards Australia New Zealand (FSANZ), a bi-national agency for the development of food standards. The joint system was instituted by The Agreement between the Government of New Zealand and the Government of Australia Establishing a System for the Development of Joint Food Standards (1995), commonly known as ‘The Food Treaty, which is one of a suite of agreements that sit within CER. The joint system has been successful in, amongst other things, aligning food standards, reducing unnecessary barriers to trade and providing both countries increased influence in the establishment of international food standards.
Quarantine issues were carved out of the original CER Agreement. In the subsequent 1988 Protocol on the Harmonisation of Quarantine Administrative Procedures New Zealand and Australia reaffirmed their commitment to the principle that quarantine requirements should not be deliberately used as a means of creating a technical barrier to trade where this is not scientifically justified. The Protocol also promoted harmonisation of quarantine and inspection standards and procedures. A high-level dialogue on biosecurity issues, known as the Consultative Group on Biosecurity Cooperation (CGBC), was established in 1999, for the purpose of strengthening trans-Tasman biosecurity relations through increased dialogue on quarantine issues.
Today, the overwhelming majority of trans-Tasman biosecurity/quarantine issues have been resolved, with few remaining outstanding. Where outstanding issues exist New Zealand and Australia endeavour to work together, for the timely resolution of the issue.
The Trans-Tasman Mutual Recognition Arrangement (TTMRA) is an important driver for regulatory coordination, with the objective of creating, in most cases, a single trans-Tasman market for the sale of goods and the registration of occupations. By allowing producers and registered occupations to meet only one set of standards, rather than two or more, mutual recognition reduces the barriers to, and the costs of, movements of goods and people between our two countries.
Under the Australia New Zealand Government Procurement Agreement, New Zealand suppliers must be given equal opportunity and treatment no less favourable than that accorded to Australian suppliers, and the Australian and New Zealand governments must promote opportunities for Australian and New Zealand suppliers to compete for government business on the basis of value for money. Essentially this creates a single ‘trans-Tasman’ market for government procurement.
Rules of Origin (ROO) are the rules that determine whether or not a good qualifies for preferential entry into Australia or New Zealand under CER. If traded goods meet the criteria under the rules of origin, they can enter duty-free.
Governments and public and private sector leaders from New Zealand and Australia meet annually to assess and advance the trans-Tasman relationship, and drive it forward in new areas.