The Australia-New Zealand Closer Economic Relations Trade Agreement turned 43 this year, making it one of the longest-running comprehensive economic partnerships globally. Unlike many trade agreements that live primarily on paper, CER has fundamentally reshaped how both economies operate.

Two-way trade hit $28.4 billion in the year to June 2025, but that headline number understates the actual integration. Investment flows tell a more complete story—New Zealand companies hold over $65 billion in Australian assets, while Australian firms have invested more than $58 billion across the Tasman. These aren’t portfolio investments; they represent operational presence and genuine cross-border business operations.

Labour mobility under CER creates effects that don’t show up in traditional trade statistics. Roughly 670,000 New Zealand citizens live in Australia, while about 75,000 Australians are based in New Zealand. This movement of skilled workers has created de facto integrated labour markets in sectors like healthcare, construction, and technology. A nurse can work in Auckland for three years, move to Melbourne for five, then return to Wellington without visa complications or credential recognition issues.

Regulatory harmonisation has progressed unevenly. Therapeutic goods and food standards are closely aligned, reducing compliance costs for manufacturers operating in both markets. Financial services regulation remains more fragmented—banking rules differ significantly, creating friction for trans-Tasman financial institutions. The recent consultation on mutual recognition of financial advisers suggests this may finally be changing.

The single aviation market created under CER transformed travel between the countries. Airlines can operate domestic services in either country, leading to competition that’s driven prices down significantly. A Sydney-Auckland flight now costs less in real terms than it did in 2000, despite fuel prices more than doubling over that period.

Interestingly, CER has created competitive pressures that benefit both countries. When New Zealand simplified its business registration processes in 2019, reducing incorporation time from 10 days to under 24 hours, Australian states faced pressure to match that efficiency. Queensland and South Australia subsequently overhauled their systems. This regulatory competition often works better than top-down harmonisation efforts.

Digital trade under CER has developed through practice rather than formal amendment. E-invoicing systems interoperate, digital signatures are mutually recognised, and data protection frameworks align closely enough that most companies treat the trans-Tasman region as a single data jurisdiction. Some of this happened by design, but much evolved through business practice and regulatory cooperation.

Agriculture remains both a success story and source of tension. New Zealand dairy products enter Australia freely, while Australian produce flows to New Zealand without barriers. But when either country negotiates third-party trade deals, agricultural access becomes complicated—New Zealand’s concerns about Australian access to the UK market under their recent FTA created diplomatic friction.

The unresolved issues are telling. Taxation remains separate, creating compliance costs for businesses operating across both countries. Superannuation portability still has gaps, particularly around tax treatment. Insolvency law differences complicate cross-border business failures. These aren’t technically CER issues, but they highlight how even deep integration has limits.

What can other trading blocs learn from CER? First, the agreement succeeded because it went beyond tariff elimination to tackle regulatory barriers. Second, the phased approach—starting with goods, then progressively adding services, investment, and labour mobility—built momentum over time. Third, the relatively similar legal and regulatory starting points between Australia and New Zealand made deep integration feasible.

CER doesn’t feature heavily in current political debates, which is perhaps the strongest evidence of its success. It’s simply how business gets done between these two economies. The infrastructure is largely invisible until you try to imagine how much more expensive and complicated trans-Tasman commerce would be without it.

As both countries negotiate new trade agreements with partners across Asia and beyond, CER provides a working model of what comprehensive economic integration actually looks like in practice. The challenge is whether that model can scale beyond two relatively similar economies.