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Australia and New Zealand

by Philippa Mein Smith

New Zealanders and Australians are neighbours and extended family who love to trade insults – and much else. Exports and workers flow freely between the two countries. Some pundits have even discussed sharing a single currency.

Shared colonial history

Although different in their physical environment, climate and scale, New Zealand and Australia are closely integrated regionally, economically, politically and culturally. The two countries have drawn closer and become more entwined since 1980.

Early history

Australia and New Zealand had quite separate indigenous histories, settled at different times by very different peoples – Australia from Indonesia or New Guinea around 50,000 years ago, New Zealand from islands in the tropical Pacific around 1250–1300 CE.

They first came together in the European imagination when a French scholar, Charles de Brosses, described the imagined southern continent as ‘Australasie’ (from the Latin for ‘south of Asia’) in 1756. British explorer James Cook, searching for that continent, mapped New Zealand and the east coast of New South Wales in 1769–70.


‘Australasia’ had fuzzy boundaries. In the first half of the 19th century maps depicted Australasia as comprising Australia and the adjacent islands, including both New Zealand and New Guinea. In some definitions the group even reached into the Pacific, including Fiji. Australian dictionaries still define Australasia as ‘the Australian continent and neighbouring islands.’1 When New Zealanders used the term it meant no more than Australia and New Zealand. It was never popular. In the mid-1920s there was a major campaign led by chambers of commerce and the High Commissioner in London to abolish it as demeaning to New Zealand. However, many organisations continued to use the term.

Colonial relationships

Australia and New Zealand were both colonised by Britain. New South Wales was the mother colony for New Zealand as well as for eastern Australia. Māori were involved from the start in shaping trans-Tasman relations. Ngāpuhi chiefs invited the first missionaries from Australia in 1814 and chose the first New Zealand flag in 1834 so that they could ply the waters and trade with New South Wales.

Constitutionally New Zealand began as an extension of the colony of New South Wales, which was its status when the Treaty of Waitangi was signed in 1840. New Zealand became a separate colony in 1841.

Many early New Zealand settlers came from Australia – some ex-convicts, some squatters bringing skills in sheep farming, and in the 1860s many gold miners, who moved from the goldfields of Victoria to Otago and the West Coast. Melbourne, not Sydney, was the port of departure. In the last decades of the 19th century labourers and shearers moved back and forth across the Tasman following work.

During those years New Zealand was known as one of the seven colonies of Australasia. Yet the idea of Australasia failed to unite the colonies. Instead the concept of Australia – ‘a nation for a continent’ – triumphed with the establishment of the Commonwealth of Australia in 1901.

New Zealand and Australian federation

Australian federation created an asymmetry of size and power between a suddenly large Australia and small New Zealand. At the time, New Zealand was doing better economically than the Australian colonies and both were restructuring their relationship with Britain. Federation was more a matter of sentiment than a business deal. New Zealand chose not to become Australia’s seventh state for similar reasons. New Zealanders shared the feelings that drove Australians to federate: they aspired to identity, status and a grander future. Racial attitudes coloured this sentiment. The ‘crimson thread of kinship’ – the British blood tie – ran through all seven colonies. But that was not enough to persuade New Zealanders to join Australia. People feared federation might put New Zealand’s social reforms at risk. Richard Seddon preferred to be premier of an independent country rather than of an Australian state that ranked third after New South Wales and Victoria.

New Zealanders believed they were a better type. Some saw Australia’s tropical north as a threat to their community’s racial – and social – purity. New Zealanders endorsed the White Australia policy but wondered how Australia could be white when it included Queensland with its population of indentured labourers from Melanesia.

Australian federation consolidated national identity on both sides of the Tasman, strengthening views that New Zealand should not sacrifice its independence.

    • Joan Hughes, ed., The concise Australian national dictionary. Melbourne: Oxford University Press, 1992, p. 15. Back

Shared state development

Politician and writer William Pember Reeves treated the seven Australasian colonies (including New Zealand) as a single site of social experiment in his State experiments in Australia and New Zealand (1902), even though he emphasised environmental differences in his marketing role as agent general in London.

There was a trans-Tasman transfer of policy and innovation. The seven colonies shared a model of state development. This had its basis in their British constitutional heritage and British law, as well as in participation in inter-colonial and imperial (later Commonwealth) conferences. The shared model was highly efficient because it saved time and resources.

Compulsory arbitration

One shared policy was the system of compulsory arbitration in industrial disputes, established between 1890 and 1914, and the male-breadwinner model of labour and welfare during much of the 20th century.

There was a similar pattern of policy convergence in the 1980s and 1990s, when both countries abandoned this model. In the 1990s Victoria borrowed many of its public-sector reforms from New Zealand. Convergence, however, did not mean uniformity. Each learnt from, and adapted, the other’s experiences.

Formal ties

New Zealand secured formal ties with Australian government structures in the late 20th century. New Zealand participated in the Council of Australian Governments (COAG) from 1992. The country functioned like a seventh state in COAG ministerial councils and committees (but not premiers’ conferences). By the early 2000s New Zealand was a member or observer on about half the COAG ministerial councils.

A joint institution to regulate food standards, Food Standards Australia New Zealand, grew out of COAG in 1996, as did the Trans-Tasman Mutual Recognition Arrangement (TTMRA) from 1998. This provided for a single trans-Tasman market for the sale of goods and registration of occupations.

Defence and security

Anzac tradition

The Anzac tradition is central to both countries’ national stories and identities, and the sentimental cornerstone of New Zealand’s relations with Australia. Troops from both countries served together at Gallipoli, Turkey, in the Australian and New Zealand Army Corps (ANZAC) during the First World War, and the anniversary of the original landing (25 April 1915) became Anzac Day, a proxy national day for both countries. The Anzac hero was a common masculine type descended from the British soldier, who embodied service, bravery, initiative and mateship. Together, Australians and New Zealanders were Anzacs. But on the Western Front they both became ‘diggers’, and informally ‘Aussies’ and ‘Kiwis’.

Yet the legend differed in the two countries. The archetypal New Zealand Anzac was a natural gentleman, the archetypal Australian a larrikin. This difference is explained by reference points. Australians – the larger force – defined themselves in contrast with the British, while New Zealand soldiers in the First World War defined themselves in contrast with both British and Australians.

The countries differed on conscription, since Australia’s Defence Act 1903 stipulated conscription for home defence but only volunteers for overseas service, and Australian voters rejected conscription twice, in 1916 and 1917. All the Australian Anzacs in the First World War were volunteers, whereas New Zealand introduced conscription in late 1916.

Memorial differences

Both Australia and New Zealand erected many war memorials after the First World War. Most New Zealand memorials listed only those who died, while most Australian ones listed all those who served. In New Zealand the focus of Anzac Day services was the laying of wreaths on the memorial, while in Australia it was the march of the veterans. It seems likely that this was because all Australian soldiers were volunteers who should therefore be honoured. In New Zealand the many dead were the primary focus of memory.

Second World War and after

Australia had a greater concern than New Zealand about military threats from Asia. This was expressed first in Australia’s decision to withdraw its troops from the Mediterranean theatre during the Second World War to defend the homeland against Japan, while New Zealand kept its division in North Africa.

Defence remained an area of divergence and occasional dispute because New Zealand did not feel as threatened as Australia. Yet the Anzac partners signed the Anzac (Canberra) Pact in 1944 and the ANZUS alliance with the United States in 1951. Divergence in defence policy peaked during the ANZUS crisis of 1984–86, when New Zealand fell out with the United States over the nuclear character of the alliance, and so unsettled Australia, for whom relations with the United States were of foremost importance.

In 2003 Australia took part in the United States-led invasion of Iraq, while New Zealand refused to send troops.

As New Zealand’s defence relationship with the United States weakened, there were efforts to cultivate stronger links with Australia. From 1991 a formal Closer Defence Relations (CDR) programme involved common training, joint defence exercises, complementary defence equipment and an Anzac frigate programme. Since 1997 there have been joint Anzac peacekeeping operations in Bougainville, Timor Leste (East Timor), the Solomon Islands and Tonga.

Trade relations

Attempts at reciprocity

For New Zealand, economic relations are the cornerstone of the relationship with Australia. New Zealand sought reciprocity in trade relations from 1870, but this did not occur until the Closer Economic Relations (CER) trade agreement, effective from 1983.

New Zealand passed an act allowing reciprocal reduced tariffs with the Australian colonies in 1870, but Britain did not permit this. Premier Richard Seddon sought a trade deal with South Australia in 1895, but this was stalled by Australia’s move towards federation. He tried again with Australia in 1906, just before he died.

However, throughout the 19th century Australia was a major trading partner of New Zealand. In the mid-1860s about 60% of trade was with Australia, and until the 1890s it was normally over 20%. The countries were linked by telegraph in 1876 and shared the costs of international mail services.

Trading difficulties

From the early 20th century New Zealand’s closer economic links with the UK hindered trans-Tasman trade relations. There were fierce conflicts over exports of potatoes and apples from New Zealand and citrus fruit from Australia. There was some progress with the first Australia–New Zealand trade agreement in 1922 and its successor in 1933, both based on British preferential tariffs, reflective of dominion ties with Britain. But trade did not boom. The proportion of New Zealand exports by value going across the Tasman fell from about 20% in 1900 to 5% in 1920, and was below that figure for the next 40 years. Australia supplied 12–18% of New Zealand imports by value.

Plant wars

In 1909 the pipfruit disease of fireblight was found on New Zealand pears and apples, and although there was little evidence that it could spread on ripe fruit, Australia banned most fruits and plants from New Zealand in 1921. Two years earlier the discovery of corky scab on New Zealand potatoes had also led to an embargo. In 1932 New Zealand reciprocated by prohibiting Australian fruit and vegetable imports because of fruit fly. The Second World War settled the dispute over potatoes. Australia lifted the ban on New Zealand apples in 2011.


In response to Britain’s growing interest in joining the European Economic Community (now the European Union), a New Zealand–Australia Free Trade Agreement (NAFTA) was signed in 1965, but British preferences were retained. Deputy prime ministers and trade ministers John McEwen and John Marshall collaborated to combat agricultural protectionism and promote the two countries’ economic development.

NAFTA built a platform of networks and relationships in business and government, which made it possible to start afresh under Closer Economic Relations (CER) from January 1983.

CER, an achievement of the conservative governments of Robert Muldoon and Malcolm Fraser, provided for a phased removal of duties and quotas. From 1990, five years ahead of schedule, there were no tariffs or quantitative restrictions on trade in goods. The agreement drove a 500% increase in trade over 20 years, with New Zealand’s exports to Australia rising to over 20% by value of its total exports. Australia became New Zealand’s principal trading partner (until it was replaced by China in 2018) and by far its leading source of investment, although not vice versa (in 2017 New Zealand was Australia’s sixth-largest trading partner). A 1988 agreement also provided, with some exceptions, for free trade in services. A 1998 agreement established a single trans-Tasman market for government procurement. New Zealand’s leading banks, its largest media company and many retail outlets were Australian-owned in the 2010s.

From CER to SEM

After 2001 there was a conscious effort at official levels to develop networks and closer integration, especially in law and business. One champion of closer business integration was the Australia–New Zealand Leadership Forum, which first met in 2004, when the two governments announced the goal of a Single Economic Market (SEM). The SEM process was designed to reduce differences in the business operating environments of the two neighbours. The forum met annually from that time.

There were moves towards legal integration in 2010 with the creation of a trans-Tasman judicial area under Trans-Tasman Proceedings acts passed in both parliaments. A memorandum of understanding on the coordination of business law, signed in 2006 and revised in 2010, required officials to cooperate ‘to ensure opportunities for deeper business integration and commercial benefits are maximised’.1 There have also been debates about a common currency, but no firm proposal.

    • Memorandum of Understanding between the Government of New Zealand and the Government of Australia on the Coordination of Business Law, 2 July 2010. Back

Common culture

People movement

As in the 19th century, the 20th and 21st centuries have seen much movement to and fro across the Tasman. In the early 1900s many Australians moved to New Zealand, including people who became active in the union movement and Labour Party. Michael Joseph Savage’s 12-strong 1935 Labour cabinet had five Australian-born men, including Savage himself. From the late 1960s the flow was reversed, as Kiwis went west to Australia. By 2006 there were 15 New Zealanders living in Australia for every 100 in New Zealand. In 2009 New Zealand was the second-largest contributor of migrants to Australia’s population. Australia became an extension of home because of visits to family, on holiday or business. Almost all Māori had whānau across the Tasman in the early 2000s. Whereas one in 50 Māori lived in Australia in 1966, that proportion was one in six in 2013.

New Zealanders have free entry to Australia under the Trans-Tasman Travel Arrangement, which allows them to reside and work there for an indefinite period. Combined queues for New Zealand and Australian passport holders at airports were introduced in 2005, and ‘smart gate’ technology at the border in 2009.

From 1948 the two countries had a social-security agreement, but after 2001, apart from age pensions, only New Zealanders who were permanent residents or also citizens of Australia qualified for other benefits. Australians in New Zealand were treated as if they were New Zealanders.

Similarity of origins and regular contact encouraged cultural similarities.

Neighbourly support

Family bonds between New Zealand and Australia came to the fore in 2009 and 2011 in response to natural disasters on both sides of the Tasman, renewing the Anzac spirit. New Zealand sent firefighters to help during the Victorian bushfires of February 2009, while Australia responded strongly to the devastating earthquake that struck Christchurch on 22 February 2011 by flying in over 750 people, including police and medical personnel. Both countries held minutes of silence in their parliaments to remember the lives lost in the two events. New Zealand firefighters responded again during the catastrophic 2019/20 Australian bushfire season.

Food heritage

The Anzac biscuit emerged as both countries’ ‘national’ biscuit in the 20th century. Rolled oats, the basic ingredient, had a Scottish heritage. The pavlova performed a parallel role as both nations’ national dessert. Lamb and potatoes were other common foods. The breakfast staple of Sanitarium Weetbix was advertised as good for ‘Aussie kids’ and ‘Kiwi kids’ in the respective markets. But Sanitarium’s Marmite spread competed in New Zealand with Australian Vegemite.

Popular culture

Strong ties of popular culture bridged the Tasman. Australian radio serials like ‘Dad and Dave’ and ‘Life with Dexter’ were popular in New Zealand. From the late 1930s the Kiwi performer Tex Morton was Australia’s first music idol, while Māori show bands and rock groups such as Split Enz became widely acclaimed in Australia. Crowded House was a trans-Tasman hybrid.

Australian publications like the Bulletin, Truth and Pix were popular in New Zealand, and writers moved both ways – the poet Henry Lawson spent time in New Zealand, while author Jean Devanny and comedian John Clarke settled in Australia.

Phar Lap relics

The legendary racehorse Phar Lap won the affection and stirred the national pride of both countries. Born near Timaru in 1926, he was sold to an Australian owner in 1928. The gangling chestnut went on to win 37 races from 51 starts, including the 1930 Melbourne Cup and the world’s richest race, the 1932 Agua Caliente Handicap in Tijuana, Mexico. He died mysteriously three weeks later, and his body was divided between Australia and New Zealand – his skeleton is at Te Papa in Wellington, his massive heart is in a jar at the National Museum of Australia in Canberra, and his hide is at the Melbourne Museum.


Horse racing has for over 150 years been a shared passion, and New Zealand punters and public follow the Melbourne Cup, Australia’s premier race. Games between the nations in rugby, rugby league, cricket, netball and minor sports are always intense and sometimes ill-mannered affairs. The famous incident in a one-day cricket game in 1981 when an Australian bowler rolled the last ball underarm – against the spirit but not the rules of the game – became, for New Zealanders at least, a symbol of the distrust which sport can engender. In the 1990s and 2000s New Zealand teams competed in Australian-based competitions in netball, football, rugby league and basketball, and Australian and New Zealand teams compete in the Super Rugby competition and the Rugby Championship. Bathurst in New South Wales is a focus for car-racing fans, and New Zealand drivers are prominent in the Australian V8 Supercars Championship.

New Australasia

In the 2010s New Zealand’s relations with Australia were closer than they had ever been. In trade, the movement of peoples, culture and attitudes the countries shared much. While Australasia as a term had fallen from favour, the two countries shared a common destiny in the Asia–Pacific region.

Hononga, rauemi nō waho

More suggestions and sources

How to cite this page: Philippa Mein Smith, 'Australia and New Zealand', Te Ara - the Encyclopedia of New Zealand, (accessed 6 March 2024)

He kōrero nā Philippa Mein Smith, i tāngia i te 20 o Hune 2012