Trans-Tasman ties: New Zealand’s relationship with Australia

New Zealand has more in common with neighbour Australia than with any other nation. We share recent histories, a largely shared Australasian English language, many joint businesses and institutions and our isolation from the rest of the world. The great trans-tasman rivalry that both sides love to perpetuate is firmly rooted on our closeness and mutual admiration, in that true ANZAC spirit. We can tell each other apart, but the rest of the world apparently finds it quite difficult to tell the difference between a Kiwi and an Aussie.

Trade and political ties

Australia is New Zealand’s most important economic and political partner, taking 22.6 per cent of our total merchandise exports and providing 17.5 percent of imports in 20091. Australia is the largest investor in New Zealand, while each country is the other’s major market for tourism. The combined domestic market for Australasian businesses is 24 million people.

Until 1901, New Zealand was one of the seven UK colonies of Australasia, along with New South Wales, Victoria, Queensland, South Australia, Western Australia and Tasmania. When Australia federated, all the colonies including New Zealand were invited to become states of the new Commonwealth of Australia. After much debate, New Zealand decided to stand on its own. However, the Australian constitution was written to enable New Zealand to join the other states as part of Australia at any time of its choosing, and this option still applies today.

Ongoing debate: New Zealand as the seventh state

Since Australian federation and New Zealand becoming a self-governing dominion in 1907, both countries have gradually cut their ties with Britain. During the last half century, Australia has forged a close relationship with the United States, provoking some division with New Zealand, particularly over our anti-nuclear policy and defence issues. At the same time, a number of significant agreements including the Trans-Tasman Travel Arrangement (1973) and Closer Economic Relations (1983) and the Trans-Tasman Mutual Recognition Arrangement (1998) have brought the two countries much closer and they now share a significant and increasing number of political and governmental institutions.

The ongoing debate about whether New Zealand and Australia should go even further and become a single entity continues. In 2004, both governments committed to a Single Economic Market, and in December 2006, the Australian Government’s standing committee on Legal and Constitutional Affairs recommended that full union between the two countries “is both desirable and realistic”. The committee went on to recommend that the two countries investigate the possibility of union, harmonise their legal systems, pursue a common currency, establish a trans-Tasman standing committee and give New Zealand ministers full membership of Australian ministerial councils, which would therefore become Australasian ministerial councils.

Australia celebrates its national day, Australia Day, on 26 January each year. It’s other major national day, ANZAC Day, is shared with New Zealand on 25 April.

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  1. 1: Overseas Merchandise Trade June 2009, Statistics New Zealand.