Australia new zealand closer economic relations trade agreement

The Australia-New Zealand Closer Economic Relations Trade Agreement (CER) is a free trade agreement between Australia and New Zealand that aims to promote economic cooperation and reduce trade barriers between the two countries. The agreement was signed in 1983 and has been updated several times since then.

Key features of the CER agreement include:

  1. Tariff elimination: The agreement eliminates tariffs on most goods traded between Australia and New Zealand, reducing the cost of trade and increasing competition.
  2. Trade liberalization: The agreement liberalizes trade in services, such as financial services, telecommunications, and transportation, and reduces restrictions on foreign investment.
  3. Rules of origin: The agreement sets out rules of origin to determine the country of origin of goods, which helps to prevent trade diversion and ensures that goods are not re-exported from one country to the other.
  4. Dispute settlement: The agreement establishes a dispute settlement mechanism to resolve trade disputes between the two countries.
  5. Cooperation: The agreement promotes cooperation between Australia and New Zealand in areas such as trade facilitation, customs procedures, and intellectual property protection.

Benefits of the CER agreement:

  1. Increased trade: The agreement has increased trade between Australia and New Zealand, with bilateral trade growing from NZ$4.5 billion in 1983 to over NZ$20 billion in 2020.
  2. Job creation: The agreement has created jobs in both countries, particularly in industries such as agriculture, manufacturing, and services.
  3. Economic growth: The agreement has contributed to economic growth in both countries, with Australia's GDP growing by 2.5% and New Zealand's GDP growing by 2.2% between 1983 and 2020.
  4. Increased investment: The agreement has increased investment between Australia and New Zealand, with Australian investment in New Zealand growing by 50% between 2010 and 2020.
  5. Simplified trade procedures: The agreement has simplified trade procedures, reducing the time and cost of importing and exporting goods between the two countries.

Challenges and limitations:

  1. Limited coverage: The agreement only covers goods and services, and does not cover areas such as investment, competition, or intellectual property.
  2. Limited liberalization: The agreement has not fully liberalized trade in some areas, such as agriculture and services.
  3. Complexity: The agreement has a complex set of rules and procedures, which can be difficult to navigate for businesses.
  4. Dispute resolution: The agreement's dispute settlement mechanism has been criticized for being slow and ineffective in resolving trade disputes.
  5. Limited enforcement: The agreement relies on self-enforcement, which can be challenging in practice.

Future developments:

  1. Upgrade: The CER agreement is being upgraded to include new areas such as digital trade, e-commerce, and services trade.
  2. Expansion: The agreement is being expanded to include new countries, such as the Pacific Islands and Southeast Asia.
  3. Deepening: The agreement is being deepened to include new areas such as investment, competition, and intellectual property.
  4. Simplification: The agreement is being simplified to reduce complexity and make it easier for businesses to navigate.

Overall, the Australia-New Zealand CER agreement has been successful in promoting economic cooperation and reducing trade barriers between the two countries. However, it also has limitations and challenges that need to be addressed in future developments.