Telstra’s Trans-Tasman business breakfast

Thank you Michael, for your kind words of introduction.

Distinguished guests, ladies and gentlemen.

I am delighted to be here and I want to thank Telstra for organising this series of Trans-Tasman business breakfasts.

The Trans-Tasman relationship in this the twentieth anniversary year of the Closer Economic Relationsagreementbetween Australia and New Zealand –CER, is in excellent shape.

CER: One of the most successful free trade agreements in the world

The CER agreement has proved to be one of the most wide-ranging and successful free trade agreements in the world.

It has been described by the World Trade Organisation as “the world’s most comprehensive, effective and mutually compatible free trade agreement”.

It is the benchmark by which Australia judges other free trade arrangements.

The objectives of the Agreement are to expand free trade by eliminating barriers to trade and promoting fair competition.

It actually, achieved its objective of removing tariffs and quantitative restrictions from trans-Tasman trade in goods by 1990 - five years ahead of schedule –and since 1988, it has covered trade in services as well as commodities.

Bilateral trade alone between Australia and New Zealand has expanded five-fold since the signing of the original agreement in 1983, to over $16.2 billion in 2001/02.

New Zealand is now Australia’s fifth largest export market, and Australia is New Zealand’s principal trading partner. Trade has grown at approximately 9 percent per annum over the past decade. And I look forward to continued strong growth in years to come.

Australia is now the largest foreign investor in New Zealand, with investments worth more than $21 billion, while New Zealand has over $12 billion invested in Australia, making it the ninth largest source of investment in this country.

CER: Economic integration at its best

Clearly, the CER is more than a free trade agreement. It is one of the most successful examples of economic integration in the world.

The CER has brought our two economies together into what is virtually a single market.

Australians and New Zealanders are banking at the same banks, driving the same cars, buying the same white goods, and even eating the same foods.

In addition to underpinning bilateral trade and investment, CER is a framework for economic integration across a spectrum of activities.

It adds real substance to what is often termed the “special relationship”between Australia and New Zealand.

Within the CER framework, we have seen steps such as the Trans-Tasman Mutual Recognition Arrangement, the joint food standards code, a proposed joint therapeutic products agency, important progress in business law co-ordination and, only last year, an open skies civil aviation agreement negotiated.

Early this year, the Australian and New Zealand Treasurers also agreed on triangular tax arrangements, which will soon be formalised.

This high level of economic co-operation contributes to growth and wealth creation on both sides of the Tasman.

It constitutes an important basis for the Australian and New Zealand business communities to operate with confidence in a single expanded market.

The way ahead

Undoubtedly, the process of harmonisation between our two economies will continue - and I hope deepen –in the future.

When they met in New Zealand earlier this year, our Treasurers identified the need for more mutual recognition arrangements in areas such as cross-border fundraising, company registration and insolvency.

As well as moving on the issue of triangular taxation, the Treasurers recognised the need for further harmonisation of taxation systems, to facilitate trans-Tasman business and investment.

And now, the Australian and New Zealand Treasurers will meet annually, as Trade Ministers do.

And Telstra has now drawn our attention to the communications sector by proposing that governments harmonise telecommunications regulatory regimes.

This is an important area for any close relationship, and it is clear that efficient communications can only improve business growth.

The issues raised by Telstra will be examined in the context of the ongoing bilateral trade discussions between Australia and New Zealand.

In fact, I will be meeting my New Zealand counterpart, Mr Jim Sutton, here in Sydney next week.

This year, in recognition of the CER twentieth anniversary, we will be joined by other economic Ministers to discuss trans-Tasman co-operation.

We will talk about improvements in rules of origin, business law co-ordination, taxation and biotechnology.

Less than a month before the WTO Ministerial Conference at Cancun in Mexico, Minister Sutton and I will also be discussing how we can advance our mutual interest in freeing up trade in agricultural products - especially within the mechanism of the Cairns Group, which Australia chairs.

More broadly, Australia and New Zealand will continue to work together on the international stage to promote our economic interests globally, as close partners should.

Conclusion

Ladies and gentlemen,

CER’s twentieth anniversary is a genuine cause for celebrations.

What Australia and New Zealand have done in 20 years is a benchmark for how the world can liberalise trade and investment.

Undoubtedly, the business activity generated by the CER has brought substantial wealth and employment for both countries.

I am confident that working together we can bring our two economies even closer together.

I applaud the efforts of business on both sides of the Tasman in that undertaking.

I thank you for your attention this morning and I wish you every success in your various trans-Tasman ventures.