Monday, January 29, 2007

Making New Zealand and Australia closer

Not for the first time, elected officials from Australia and New Zealand are meeting to try and make the nations’ already close relationship closer still. New Zealand’s Finance Minister, Michael Cullen, and Australian Treasurer Peter Costello are meeting today in Wellington.

The two countries have had the Closer Economic Relations agreement since 1983, and attempts have been made ever since to move from free trade toward integrated economies, with some pushing outright merger.

The Dominion Post reported that “Dr Cullen said talks would focus on trans-Tasman tax issues, business law coordination, banking supervision, climate change and trade, and mutual recognition of qualifications.” Not exactly rabble-rousing stuff for most people.

In the past, moves toward greater economic—well, merger, is probably the best word—have stalled on this side of the Tasman as people worried that New Zealand companies might be swallowed up by Australia or, worse, New Zealand’s national identity might be lost, making us Australia’s de facto seventh state.

In fact, plenty of leading New Zealand companies have already been swallowed up by Australian companies (including all our main trading banks). A common currency would most likely mean adopting the Aussie dollar, given their stated opposition to any other option. New Zealand has always rejected that idea.

I’ve said before how I wouldn’t rule out the possibility of some sort of union happening in the future. What fascinates me about all of this is that the subject of closer economic integration and outright merger of the countries comes up again and again and again, and it’s always treated seriously, even if merger is often described as not going to happen.

I can’t imagine any similar serious ongoing talk of union between the US and Canada and/or Mexico. Does that mean that some sort of Aussie-Kiwi merger is inevitable? Probably not, but it does mean the idea’s not totally absurd, either.

In the meantime, both countries settle for talks aimed at reducing barriers for business. Maybe that’s all we should expect for now. But such talks certainly don’t make the larger discussion of merger go away, nor my fascination with the subject’s persistence.

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