Labour shortages, supply chain disruption and climate change are expected to be among the topics of discussion on the Prime Minister's Australian trade mission.

Prime Minister Jacinda Ardern starts a trade mission in Melbourne today before talks with her Australian counterpart.

Ardern was in Sydney just a few weeks ago to meet the newly elected Prime Minister Anthony Albanese.

She returns today for a series of trade, tourism and business events in Melbourne and Sydney.

She will speak at the Australia New Zealand Leadership Forum and deliver what's described as a 'major foreign policy speech' at the Lowy Institute, before meeting Albanese for their annual bilateral talks on Friday.

Albanese has been in Ukraine overnight.

Ardern's trip - and trans-Tasman leader talks - come one week before the Pacific Islands Forum in Fiji.

On behalf of the prime minister, senior minister Megan Woods told Morning Report it was unclear whether 501 deportees would be a subject of discussion at the meeting today.

Ardern and Albanese have previously pledged to continue to hold talks around the issue of 501 deportees.

"It is something that we saw the prime minister raised at her first meeting with Anthony Albanese, it's something that she's consistently raised with Australia and I can't see her taking her foot off the pedal on that anytime soon," Woods said.

Ardern's trip would focus on the economic reconnection of Australia and New Zealand through strengthening relationships between government agencies and businesses, Woods said.

New Zealand's newly signed free trade deal with the European Union has sparked fears that Aotearoa-based businesses could be set to face a harsher economic climate responsibility than our neighbours across the Tasman.

New Zealand's newly signed EU free trade deal allowed for sanctions to be imparted if climate changes failed to be met, Woods said.

Meanwhile, Australia's agreement was older and did not include such an agreement, she said.

Australia was due to reevaluate its own free trade deal with Europe and the provision of climate change-related sanctions could likely be included in any new agreement, she said.

"In terms of our trade agreements, for Australia, it doesn't have any such provision in it, it's a much older agreement but certainly Australia and New Zealand can work better and closer together on climate change.

"This is about a change that we're seeing in trade agreements that will be interesting to see how they roll out around the world and I imagine it will be something the Australians and the Europeans will need to talk about in the context of their agreement," Woods said.

Woods said she had seen an "upping in ambition" around climate change targets since the new Australian government had come into power.

She said New Zealand's trade-exposed industries were offered some domestic protection from economic climate change responsibilities through the Emissions Trading Scheme.

Labour MP Megan Woods

File photo of Megan Woods. Photo: RNZ / Angus Dreaver

'It is really important that we keep in step with each other' - Business NZ's Catherine Beard duration4′ :56″ 

from Morning Report

 

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'It is really important that we keep in step with each other' - Business NZ's Catherine Beard

Business New Zealand director of advocacy Catherine Beard said the countries needed to work at a similar pace on climate change, so Australia did not become more attractive for emission-intensive businesses.

She said inflation and economic recovery from the pandemic were also likely to be talking points.

"It's great to see that they have some new leadership on emissions reduction because I think it is fair to say New Zealand was probably going harder and faster in that regard.

"It is really important that we keep in step with each other because otherwise it becomes more expensive to do business in one country over the other and potentially have businesses moving for those reasons," Beard said.

With Revenue Minister David Parker not present on the trip, Woods said it was unlikely the prime minister's talks would focus on discussions around Australia's trans-Tasman imputation tax.

Catherine Beard said Australia's imputation tax had been a long-running issue for Kiwi businesses.

"If you're doing business in Australia and you want to bring the profits back to New Zealand, so you know you're exporting, if you want to distribute those profits to shareholders you get essentially double-taxed on them so that's been a long-running debate we've been having with Australia."

Beard said talks around imputation tax remained an "uphill battle" but there was some optimism that progress could be achieved in talks with Australia's new leadership.

She said she would raise the issue at the Australia-New Zealand Leadership Forum later this week.