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Deep Economic Integration and Political Ambivalence: Popular Constraints on Elite Driven Integration between Australia and New Zealand

John Leslie, Ann-Marie Elijah

Trans-Tasman integration between Australia and New Zealand strikes an odd balance between economic and political integration. For 30 years Australasian policy makers have driven economic integration 'deep' behind borders, creating a trans-Tasman Single Economic Market that rivals European integration in many areas. Further, deep economic integration parallels significant coordination of Australian and New Zealand foreign and defence policies as well as complete freedom of movement for the citizens of the two countries. Yet longstanding sensitivities relating to the nature of political integration between the two countries mean that politicians on both sides of the Tasman typically avoid serious discussion of further political commitments. This paper explains the peculiar Australasian combination of 'deep' economic integration and ambivalence toward closer political union as the product of a chasm between elite and popular sentiment in both countries about reasons for integration. Elite policy makers have driven trans-Tasman economic integration to economize regulatory capacity in small jurisdictions and to magnify their influence internationally. Popular sentiment tolerates (or ignores) elite-driven integration until it touches on issues where 'sovereignty' becomes electorally salient. This paper investigates four areas where integration efforts have at one time stirred popular concerns for sovereignty that were otherwise absent: markets for trans-Tasman air travel, the regulation of therapeutic products, monetary union and investment. It asks when and why some issues raise popular concerns about sovereignty that constrain elite efforts at integration. It also asks whether the present balance in trans-Tasman integration is tenable, given pressures for integration within Australasia as well as efforts to integrate Australia and New Zealand more deeply into the evolving architecture of the Asia-pacific region.

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