More than half of Australian exporters (57 per cent) say harmonisation of regulatory and tax laws would have the greatest impact on reducing trans-Tasman trade barriers, compared to 28 per cent supporting a single currency, a new DHL survey has found.
The DHL Trans-Tasman Traders’ survey of 535 Australian and New Zealand exporters found 69 per cent of all exporters think more can be done to improve Trans Tasman trade.
Senior vice president of DHL Oceania Gary Edstein said: “While more Australian exporters export to New Zealand than anywhere else in the world, almost half (49 per cent) of them say they experience trade barriers when selling to New Zealand.
“There has been much debate on the value of a single currency to improving trans-Tasman trade, however closer attention needs to be given to common tax laws including GST and company trade restrictions,” said Mr Edstein.
Tim Harcourt, chief economist for Austrade said: “Closer Economic Relations (CER) between Australia and NZ has been an unqualified success with nearly 17,900 Aussie companies now exporting across the ditch.
“Harmonisation of the legal and tax systems will help reduce costs and improve trade inefficiencies. Intellectual property, information sharing, cross-recognition of companies and competition law are all on the agenda for creating a single economic market. Austrade and Trade and Enterprise New Zealand are also working together on many ‘ANZAC’ trade missions to third markets in areas such as clean energy.
The survey also found that half of Australian exporters think New Zealand will be harder hit than Australia by the global financial crisis and 64 per cent think Australia will recover faster than our trans-Tasman cousins compared to only 46 per cent of New Zealand respondents believing they would beat the recession sooner than Australia.
“It’s not surprising that Australians are more confident given the global demands for Australia’s commodities are still relatively strong. While there is no doubt Australia is feeling the impact of the global economic crisis, compared to other countries, Australia is in a good position to weather the storm,” said Mr Edstein.
“Our economies are similar, but in the current global financial crisis NZ has experienced a slowdown earlier than us, and whether they’ll recover quickly remains to be seen”, said Mr Harcourt.
“The slowing in Asia has hurt Kiwi exports, but the lower exchange rate and fiscal intervention is helping NZ exporting businesses. The OECD has pointed out NZ’s large current account deficits and higher external debt make NZ more vulnerable to external shocks,” Mr Harcourt continued.
When asked if they were happy with the current level of activity in moving towards a single economic market, only 35 per cent of all respondents said they were satisfied with 34 per cent thinking more could be done. A third of respondents (31 per cent) did not feel sufficiently informed to judge whether they were satisfied with the level of activity towards freeing trans-Tasman trade.
“The respective governments need to engage with stakeholders more, and increase the level of awareness and interest in the process. After all, the Closer Economic Relations (CER) program was the most successful free trade agreement in our countries’ history. Going beyond that to create a single economic market should be high on the agenda,” said Mr Edstein.
New Zealand respondents think the Australian government (23 per cent) is working harder at improving Trans Tasman relations than the New Zealand government (4 per cent) while 39 per cent of Australian exporters think the government efforts by both countries were the same.
Unsurprisingly there was wide support on both sides of the Tasman for the recent announcement to reclassify flights between New Zealand and Australia as ‘domestic’ with 93 per cent of all exporters in favour, possibly anticipating cheaper flights.