Dalziel: CER op-ed
by Lianne Dalziel, Commerce Minister
Few relationships are as warm, enduring and characterised by such friendly rivalry and mature co-operation as that between New Zealand and Australia. The strength of the bond between New Zealanders and our trans-Tasman neighbours has become a part of our identity as a nation, from the comradeship of the early ANZACs to the trade, business, diplomatic, sporting and travel relationships of the present day.
This week we celebrate 25 years of the Closer Economic Relations (CER) trade agreement between New Zealand and Australia. CER was born out of a desire to have an open trading relationship with our nearest neighbour and largest market. But today CER means much more than just trade. CER underpins and builds on strong historical, cultural, geographical and political ties, reflecting the values and interests that both our countries share. It has transformed into a comprehensive, dynamic agreement which has shown itself capable of adapting to the evolving requirements of business.
The World Trade Organisation (WTO) has hailed CER as the most comprehensive, effective and mutually compatible bilateral free trade agreement in the world which has led to significant trade growth between the two nations.
The Australian and New Zealand economies are becoming increasingly integrated, not just through trade but also the high degree of regulatory co-ordination of the goods and services markets. These dynamic effects have shaped labour markets responses, the design of business operations and investment decisions in the trans-Tasman market. Today, businesses in both countries hold nearly $100 billion of investment stock across the Tasman. Australia is New Zealand’s top source, and top destination, of foreign investment.
Since 1997 the Trans Tasman Mutual Recognition Agreement (TTMRA) has played a central role in driving deeper levels of regulatory policy co-operation between the two countries, making it a valuable instrument of CER. The principle of the TTMRA is that each country accepts the other's regulatory approaches so that a qualification or standard accepted on one side of the Tasman is deemed to meet the requirements on the other. It's a vital tool in both governments' shared vision of creating a seamless trans-Tasman business environment, or Single Economic Market (SEM), to support our businesses in meeting the challenges of an increasingly competitive global environment.
Work towards a SEM particularly under the Memorandum on Business Law Coordination will further strengthen the trans-Tasman relationship by reducing transaction costs and behind-the-border barriers to trade for businesses operating on both sides of the Tasman.
Another area of particular interest to me as Commerce Minister is the development of joint Australian/New Zealand Standards. This joint framework has resulted in lowering costs to business and improved competitiveness from being able to manufacture to a single standard. There are currently over 2300 joint Australian/New Zealand Standards, accounting for 75 per cent of the New Zealand Standards catalogue, in areas including energy efficiency, wood products, gas and electrical safety and risk management.
The importance of CER on making sense of our business relationships with Australia in the face of global competition can not be underestimated. On the 25th anniversary of CER, New Zealand looks forward to further building on that strong and enduring relationship with Australia.