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Thursday 17 Aug 2017 | 01:46 | SYDNEY
Thursday 17 Aug 2017 | 01:46 | SYDNEY

NZ: Better as a friend than family

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7 April 2011 11:10

Before the financial crisis skewed things even further, New Zealand's per capita wealth was 87 percent less than that of Western Australia. But what really caused angst across the ditch was that New Zealanders' average wealth was 13 percent lower than Tasmania's.

You can explain a richer WA by what's in the ground — but Tasmania has exactly the same assets as New Zealand, only much fewer of them. The logical question that few Kiwis dare utter out loud, is whether their forebears made the right decision about not joining the Australian federation.

There's an economic pessimism that pervades every non-sport-related conversation you have in New Zealand. It takes the visitor by surprise, because the place looks as wealthy as Sydney or Melbourne (I'm visiting this week as a guest of the Asia-New Zealand Foundation).

But it's not long before you realize the causes of the pessimism: the remarkable boom that's occurring in Australia. No Kiwi I've spoken to has failed to mention the El Dorado across the Tasman.

The streets of Auckland and Wellington are heavily populated with Australian brands that have come over and prospered. And labour-starved Australia is a massive magnet pulling skilled New Zealanders in — especially as the New Zealand economy splutters along and places like the UK wind up their working holiday visa schemes.

But if things continue along the current trajectory, Tasmania pulls further and further ahead in wealth, and out of sheer despair New Zealand applies to become the seventh Australian state, this time we should say no.

Not because of any residual anti-Kiwism or lingering resentment over the All Blacks' record against the Wallabies. But because an independent New Zealand is an unacknowledged foreign policy trump card for Australia.

Wellington and Canberra have never been closer in foreign policy terms. The Ministers see eye to eye, the diplomats all know each other; the Ministries are even on similar regimes of starvation rations when it comes to resourcing. But New Zealand is achieving easy wins in games that Australia is really struggling with.

Canberra's free trade talks with China are bogged down; the Kiwis signed one three years ago. Australia wants to join and then expand the Trade Pacific Partnership; New Zealand was a founding member. With APEC facing host years by the United States and Russia — the two states least interested in it — New Zealand has taken the initiative in reaching out to Russia with a proposal for a free trade deal — and the Russians have accepted with relief.

Both Australia and New Zealand are looking at a free trade agreement with India. I know which country I'd back to get there first. The Kiwis have none of our baggage with the Indians. They never had a White New Zealand Policy. Nor do they have uranium. No one could accuse them of being American lickspittles. And instead of beating up ethnic Indians, the Kiwis have one as their Governor-General.

The point is, New Zealand can advance positions much more effectively for both countries because it is smaller and less encumbered than Australia. It is the least threatening western country in the world.

That's why we should keep the Kiwis out of the federation — but keep hugging them very close.

Photo by Flickr user the.rohit.

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