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Australia and New Zealand maintain a highly integrated bilateral economic relationship, supported by decades of formal agreements and practical cooperation. The two economies are often described as functioning as a “single economic market" which is underpinned by the Australia-New Zealand Closer Economic Relations agreement which drives integration across trade, investment, regulation, and mobility .In 2024, two-way trade between the two countries reached A$37.8 billion, comprising A$19.4 billion in Australian exports and A$18.3 billion in imports. The total stock of two-way investment stood at A$290 billion, with Australia accounting for A$205 billion of investment in New Zealand.
Australia–New Zealand Closer Economic Relations Trade Agreement (ANZCERTA)
The central framework underpinning trans-Tasman economic integration is the Australia–New Zealand Closer Economic Relations Trade Agreement (ANZCERTA), which was signed on 28 March 1983 and came into force on 1 January 1983. ANZCERTA is regarded as one of the most comprehensive and successful free trade agreements globally. It built upon the earlier New Zealand Australia Free Trade Agreement (NAFTA) of 1965, which had reduced tariffs but proved too complex to sustain.
A major milestone under ANZCERTA was the Protocol on the Acceleration of Free Trade in Goods, which eliminated all tariffs and quantitative restrictions on goods by 1990, five years ahead of schedule. The agreement also became the first in the world to introduce free trade in services, with the Services Protocol of 1989 removing most restrictions on services trade. These innovations made ANZCERTA a model agreement for subsequent global trade liberalisation efforts.
Single Economic Market (SEM).
Since 2004, Australia and New Zealand have worked towards creating a Single Economic Market (SEM). This initiative builds on ANZCERTA by reducing compliance costs and aligning regulations to create a seamless environment for businesses operating across the Tasman. Recent commitments in August 2024 focused on modernising the SEM to respond to technological change, ensuring resilience against global shocks, and integrating with wider regional frameworks.
The SEM complements a suite of bilateral arrangements covering mutual recognition of product standards and professional qualifications, government procurement, taxation, and the Trans-Tasman Travel Arrangement of 1973, which allows citizens to live and work freely across both countries.
Multilateral Agreements
Alongside ANZCERTA, both countries participate in several multilateral frameworks, including the ASEAN–Australia–New Zealand Free Trade Area (AANZFTA), the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the Pacific Agreement on Closer Economic Relations Plus (PACER Plus), and the Regional Comprehensive Economic Partnership Agreement (RCEP). They also work together in the World Trade Organization, particularly through the Cairns Group of agricultural exporters.
In 2023-24, New Zealand ranked as Australia's 7th largest two-way trading partner, while Australia was New Zealand's 2nd largest. Since ANZCERTA’s inception, two-way merchandise trade has grown at an average annual rate of about 8 per cent. In 2024, two-way trade reached about A$37.8 billion. Australia remains New Zealand’s principal trading partner for both imports and exports, while New Zealand consistently ranks within Australia’s top ten trading partners.
Exports
For Australia, New Zealand is its 8th largest destination for goods and services exports, and its biggest market for manufactured products, insurance, and pension services. Our top 5 exports are in recreational travel, business services, transport services, telecommunication equipment and parts, and insurance and pension services.
Imports
Australia’s top 5 imports from New Zealand are in recreational travel, transport services, business services, business-related travel, and gold. Proximity makes Australia a key market for New Zealand’s tourism sector, with Australia’s being the largest group of visitors to New Zealand by number.
Investment flows mirror the strength of trade. Australia is the largest source of foreign investment in New Zealand. In 2009, it held about 50 per cent of the total stock of direct foreign investment, valued at AUD 79.8 billion. More recent figures place Australia’s investment in New Zealand at around A$205 billion. Direct investment has historically accounted for more than half of this total.
New Zealand is also a significant investor in Australia, ranking 12th in 2024 with stocks valued at A$85 billion. Overall, two-way investment exceeded A$290 billion in 2024, reflecting the high level of integration in sectors such as finance, agriculture, retail, and infrastructure.
Recognising that ANZCERTA did not originally cover investment, the two countries signed an Investment Protocol in 2013. This agreement aimed to reduce barriers to trans-Tasman investment flows, improve transparency, and provide stronger protections for investors.
Key features included raising foreign investment screening thresholds significantly, exempting many New Zealand investments in Australia from review, and providing investor protections similar to those in the Australia–United States Free Trade Agreement. The Protocol also introduced a “ratchet mechanism” to lock in future liberalisation and a Most Favoured Nation clause to ensure that neither country is disadvantaged compared with other partners.
The Australia–New Zealand relationship today stands as a model of integration. With two-way trade approaching AUD 38 billion, two-way investment exceeding AUD 290 billion, and ongoing efforts to build a seamless economic market, the trans-Tasman partnership continues to be one of the most comprehensive and dynamic bilateral relationships in the world.
For those who wish to explore further, key sources include DFAT’s country fact sheets and New Zealand’s Ministry of Foreign Affairs and Trade trade statistics. Also useful are the full texts of the CER and its Investment Protocol, and periodic ministerial communiques such as the 2024 CER ministerial joint statement.
Even jobs you’d think are 100 percent Australian rely on our international trade and investment. Our health care professionals rely on a lot of technology, treatment methods and drugs imported from overseas. Our teachers use computers and classroom materials often sourced from other countries and teaching methods developed in classrooms around the world. Our police drive patrol cars built overseas.
Australia’s international trade and investment relationships also give us access to an array of ideas and information that we generally take for granted. Books, movies, music, computer programs, medical procedures, industrial designs– Australians contribute to, and take from, the huge global market for these ideas. Australia’s trade in intellectual property has a major impact on our way of life.
There can be negative consequences from our reliance on international trade and investment. When our trade partners unfairly block our exports, Australian businesses can lose sales and suffer financially. Equally, were the Australian Government to unfairly block or restrict imports or exports, our relationships with international partners can suffer. Using trade as a weapon can hurt businesses and erode trust between countries. The environmental impact of international trade has also attracted a lot of attention as a possible negative consequence of Australia’s reliance on international trade and investment.
Despite these potential negative consequences, the lives of the vast majority of Australians are sustained and directed in some way by the goods, services, ideas and money that flow between Australia and other countries. It’s easy to ignore this impact when trade and investment flow. And for much of our history before and after the arrival of Europeans, Australia’s trade and investment has continued to flow though buffeted by geopolitics, changes in technology and consumer trends, and times when people wanted to close themselves off from the world and turn inward.
At ACITI, we believe international trade and investment make an important contribution to the Australian way of life. We believe it’s important that Australians have access to information on our trade and investment practice, profile, policy and research so you can better understand how international trade and investment impacts on you.
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