International Trade between Australia and New Zealand

Running Head: International trade 1
International trade

International trade 2
Executive summary:
Relations between the Australia and New Zealand are also called as Trans-Tasman relations, as
both the countries shared great history, standards, organizations, personal relationships, healthy
rivalry with each other. All these things make their relations more strong and close. They work
together in almost every area of the government which also includes issues related to trade,
economy, defense and foreign policy.
Almost 2.5 million short term stays are made by the citizens of both the countries across the
Tasman each year, and both the countries have large number of population of other country.
However, cultures of both the countries are completely different, but still there ancient bonds,
domestic ties, and friendships helped each other to make their relations more strong.
Australia and New Zealand work closely with each other on different issues such as policy
related to foreign matters, security, trade, etc. and it also involve international institutions such as
the United Nations and World Trade Organization. They also cooperate on aid and development
works in the Pacific and South East Asia regions. Economic relations of the countries are
recognized by the Australia and New Zealand Closer Economic Relations (CER). CER is the
most effective free trade agreement across the globe. They have also dedicated to a process
known as Single Economic Market (SEM) agenda, as this process is designed for the purpose of
creating a seamless trans-Tasman business environment.
This report outlines the status of international trade between Australia and New Zealand (NZ).
New Zealand enters into number of free trade agreements, one of these agreements is the long
standing Closer Economic Relationships (CER) agreement with Australia and other trade
agreement is the NZ China Free Trade. Recently, NZ has been agreed on Trans Pacific

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Partnership Agreement (TPPA) and this agreement is going to be ratified by 12 signatory
governments.
Contents
Executive summary:....................................................................................................................................2
Introduction:...............................................................................................................................................4
Discussion:...................................................................................................................................................6
Objectives of trade agreements:.............................................................................................................6
CER:.....................................................................................................................................................6
New Zealand–China Free Trade Agreement:.......................................................................................8
Benefits from treaty:...................................................................................................................................9
CER:.........................................................................................................................................................9
FTA:........................................................................................................................................................12
Disadvantages of treaty:............................................................................................................................13
CER:.......................................................................................................................................................14
FTA:........................................................................................................................................................15

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Wealth from CER and FTA:........................................................................................................................15
NZ Perspective:......................................................................................................................................15
CER:...................................................................................................................................................16
NZCFTA:.............................................................................................................................................17
Dairy industry perspective:....................................................................................................................18
Tatua perspective:.................................................................................................................................20
TPPA Effect:...............................................................................................................................................21
Tatua Perspective:.................................................................................................................................23
Conclusion:................................................................................................................................................23
Recommendations:....................................................................................................................................24
References:................................................................................................................................................25
Introduction:
New Zealand is a trade dependent economy which is completely different from export markets,
as this country provides maximum support to the free and open trade. This country got the one of
the biggest open market economies in the world (NZ foreign affairs & trade, n.d.).

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The Trans-Pacific Partnership (TPP) is an agreement which is secretive and ensures
multinational trade. TPP mainly exposed to spread the preventive intellectual property (IP) laws
across the globe. In other words, TPP is an agreement which mainly helps in liberalizing the
trade between the 12 Pacific-rim countries. These countries are New Zealand, Australia, Brunei
Darussalam, Canada, Chile, Japan, Malaysia, Mexico, Peru, Singapore, the United States and
Viet Nam (NZ foreign affairs & trade, nd.).
This agreement is signed on February 2016 and it is ratified in May 2017 by the New Zealand
which is also the depository for the TPP. It must be noted that this agreement is also ratified by
Japan. However, this agreement cannot be enforced till the time it is ratified by other four
countries which also includes United States. Notification is send by the US that it does not intend
to become the party of TPP (BBC, 2013).
After the withdrawal of US, ministers of other 11 countries confirm the importance of the TPP in
context of economic and strategic approach. Negotiations related to this agreement are concluded
on 23rd January 2018 on the Comprehensive and Progressive Agreement for Trans-Pacific
Partnership (CPTPP).
CPTPP is the agreement which is based on the Trans Pacific Partnership (TPP), and this
agreement is signed in February 2016 but never enforced because of the withdrawal of the US.
This new agreement includes different elements of TPP that were negotiated as part of TPP butt
there are some important differences (Electronic Frontier Foundation, n.d.).
Partnership with other countries provide large number of opportunities for New Zealand, and this
agreement help the NZ to expand their activities in new destinations of exports in context of their
business. This agreement also help by creating the jobs and result in better standard of living for

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all the citizens of NZ. At same time, it protects the right of government to regulate in the public
interest and the unique status of the Treaty of Waitangi (NZ foreign affairs & trade, nd.).
This report is written for the Board of the Dairy Company Tatua, and it mainly reviews the
existing trade agreements and also the impact of TPP on the existing markets. Structure of this
report includes different sections which answer different questions such as objectives of the CER
& New Zealand China free trade agreements, benefits of these agreements to the society of NZ,
disadvantages of these agreements to the society of NZ, how these agreements create wealth for
different people, and impact of TPP on CER and New Zealand China Free Trade Agreement.
This report also includes recommendations. Lastly, paper is concluded with brief conclusion.
Discussion:
Objectives of trade agreements:
This section of the report defines the objectives of two different free trade agreements from NZ’s
perspective:
CER:
The Australia – New Zealand Closer Economic Relations Trade Agreement is also referred as
ANZCERTA or the CER Agreement, and this agreement is the most important bilateral free
trade agreement. Generally, this agreement involves all the goods related to trans-Tasman as it
also includes agricultural products and it is the first agreement which includes free trade in
context of services. The main objective of this agreement is the creation of a World Trade
Organization which consist Free Trade Area encompassing Australia and New Zealand.