NZ-Australia Closer Economic Relations (CER)
New Zealand and Australia’s economic and trading relationship is recognised as one of the closest, broadest and mutually compatible in the world.
Since 1983 trade between New Zealand and Australia has increased steadily. Trans-Tasman trade in goods was NZ$14.5 billion. Our goods exports to Australia were NZ$8.3 billion, making up 17.1% of our total exports.
Australia is our biggest services trade partner. 21% of all our services exports are to Australia ($NZ 3.8 billion) and services imports from Australia make up 29.4% (NZ$5.1 billion) of all our service imports.
Foreign direct investment between New Zealand and Australia was almost NZ$66 billion as at March 2017. Australia is our top destination for overseas investment. New Zealand had direct investment stocks of NZ$12.6 billion in Australia as at March 2017. Australia is the largest source of foreign direct investment in New Zealand, at NZ$53 billion.
Single Economic Market
New Zealand and Australia have committed to creating a seamless trans-Tasman economic environment, making it as easy for New Zealanders to do business in Australia as it is to do business in and around New Zealand. This is known as the Single Economic Market (SEM), and builds on the foundation of the CER Agreement.
CER ministerial discussions
The Australian and New Zealand Trade Ministers hold regular CER/SEM meetings as a forum to oversee the CER and to provide direction for the SEM agenda.
Australia Population: 24.39 million
Australia GDP: US$1.205 trillion (2016)
Timeline: CER replaced the 1965 New Zealand Australia Free Trade Agreement (NAFTA). Talks began in the late 1970s and a new agreement was reached in December 1982. CER came into force in January 1983.
NZ’s major goods exports to Australia (March 2017): precious metals, jewellery and coins (NZ$625 million), crude oil (NZ$587 million), misc. edible preparations (NZ$577 million).
NZ’s major goods imports from Australia (March 2017): motor vehicles (NZ$428 million), mechanical machinery and equipment (NZ$399 million), misc. edible preparations (NZ$320 million).
- all tariffs and quotas were eliminated by 1990, five years ahead of the CER schedule
- most goods that can be legally sold in one country can also be legally sold in the other
- the 1989 Trade in Services Protocol (external link) allows for most services to be traded across the Tasman free of restriction
- the Trans Tasman Mutual Recognition Arrangement (TTMRA (external link)) allows for anyone who is registered to practice an occupation in one country to practice in the other
- New Zealanders and Australians are free to visit, live and work in each other’s country under the Trans-Tasman Travel Arrangement.
- it is easier to invest in each other’s countries under the March 2013 Investment Protocol [PDF, 88 KB]
- lower compliance costs for food exporters and more consumer choice under the 1995 Food Standards Treaty (external link) which created common rules for food standards
- lower withholding taxes on certain payments made between New Zealand and Australia, through the Double Taxation Agreement (external link)
Businesses trading in goods
All goods which meet CER Rules of Origin can be traded free of tariffs between New Zealand and Australia.
New Zealand has a second FTA with Australia – AANZFTA – which is between New Zealand, Australia and the Association of South East Asian Nations (ASEAN). In most instances you’ll be better off using the CER to export goods to Australia.
Service sector businesses
The 1988 CER Protocol on Trade in Services (external link) achieved free trade in nearly all services, allowing New Zealand and Australian service provider’s comprehensive access to each other’s market. The Protocol contains some exclusions (areas where full access is not provided), which are regularly reviewed and have been substantially reduced over time.
Australia has the following exclusions:
- Broadcasting and television (shortwave and satellite broadcasting)
- Compulsory third-party motor vehicle insurance
- Specified postal services
- Coastal shipping cabotage policy
New Zealand has the following exclusions:
- Air services
- Coastal shipping
The 2013 CER Investment Protocol is an ambitious investment agreement, and maintains CER’s status as one of the world’s most comprehensive free trade agreements. The Protocol reduces compliance costs and provides greater legal certainty for trans-Tasman investors by providing higher thresholds at which foreign investments are screened.
The Australia New Zealand Leadership Forum (ANZLF) is a business-led initiative designed to further develop both the Australian and New Zealand bilateral relationship, and to provide a vehicle for direct business input into the trans-Tasman economic integration agenda. The ANZLF brings together Ministers and leaders of business, government and academia to create an independent public platform for discussing the Australia New Zealand relationship. In February 2015 the ANZLF celebrated its tenth anniversary, and the eleventh ANZLF was held in Sydney in October 2016.
The ANZLF has been influential in setting the trans-Tasman agenda in the past, particularly in the economic space, such as supporting the acceleration of the SEM initiative and advancing the concept of ‘net trans-Tasman benefit’. It has a New Zealand Co-Chair (currently Adrian Littlewood, Chief Executive of Auckland Airport) and an Australian Co-Chair (Ann Sherry AO, Executive Chairman of Carnival Australia). The ANZLF has working groups that have been championing and shaping the agenda across five sectors: innovation, infrastructure, tourism, health technology and agribusiness.
Tariff schedules in HS2017
CER Investment Protocol
New Zealand Australia CER Investment Protocol: Factsheet [PDF, 478 KB]
New Zealand Australia CER Investment Protocol: National Interest Analysis (NIA) [PDF, 517 KB] tabled in Parliament 16 February 2011
- Annex 1: Schedule of New Zealand [PDF, 143 KB]
- Annex 2: Schedule of Australia [PDF, 123 KB]
- Side Letter concerning New Zealand's Reservation with Respect to Water [PDF, 16 KB]
- Side Letter concerning Clarification of Australian Non-conforming Measures at Regional Level of Government [PDF, 17 KB]
- Side Letter concerning the New Zealand Most Favoured Nation (MFN) Reservation [PDF, 15 KB]
Regulatory environment for businesses
Memorandum of Understanding on the Coordination of Business Law (external link) (Ministry of Business Innovation and Employment)
Joint Food Standards Agreement (external link) (NZ Food Safety Authority))
Double Tax Agreement (external link) (Inland Revenue)