New Zealand scoffs at statehood idea

Prime Minister Clark said Mr Hewson could "dream on".

The Prime Minister of New Zealand, Helen Clark, has dismissed a suggestion that her country should become part of Australia.

Former Australian Liberal Party leader John Hewson, who served as Australia's opposition leader in the early 1990s, said it was time to consider incorporating New Zealand into a new independent republic of Australia.

We intend to keep all of our identity, and more

Helen Clark, New Zealand's Prime Minister

But New Zealand Prime Minister Helen Clark said Mr Hewson could "dream on".

In the Australian Financial Review, Mr Hewson noted that the two countries had made good progress on bringing their economies together, and that interest in a common currency and full financial harmonisation had grown.

Symbolic difficulties

"Admittedly, there will be a host of symbolic difficulties, like knighthoods and perhaps the need for a new Australian flag," he said of merging the two countries.

"But none of these issues is insurmountable. Most importantly, New Zealand would be able to maintain its individualistic and competitive character," Mr Hewson wrote.

"How generous of him to say we could keep some of our identity. We intend to keep all of our identity, and more," Ms Clark retorted to Mr Hewson's suggestions.

She said the two countries would continue to harmonise their economies and the open labour market between the two would remain.

"But that's where it begins and ends," she said.