New Zealand and Iceland Forge Closer Ties on Jobs, Taxation, and Clean Energy

In a significant move to deepen bilateral ties, New Zealand and Iceland have unveiled a set of new cooperative initiatives focused on working holiday opportunities, fairer tax arrangements, and geothermal energy collaboration. The announcement was made by Foreign Minister Winston Peters, who is currently visiting Iceland as part of a broader diplomatic tour of the Nordic region.

Shared Values, Shared Opportunities

"New Zealand and Iceland may be oceans apart, but we are two island nations united by shared values," said Minister Peters. "These initiatives represent a meaningful step forward in enhancing our cooperation with Iceland."

The agreements reflect a growing recognition of shared interests between the two geographically distant but philosophically aligned nations—particularly in areas such as youth mobility, sustainable energy development, and open economic engagement.

Working Holiday Scheme to Strengthen Youth Exchange

A major highlight of the visit was the announcement that New Zealand and Iceland will begin negotiations to establish a reciprocal Working Holiday Scheme. This programme will allow young citizens from both countries to live, work, and travel in each other's territories for extended periods.

"A working holiday scheme with Iceland will create new opportunities for our young people to connect, collaborate, and contribute to each other's societies," said Mr Peters. "It also provides valuable international experience while enriching our economies and communities."

Immigration Minister Erica Stanford echoed the sentiment, noting the mutual benefits for tourism, culture, and regional employment.

"Beyond individual benefits, a scheme with Iceland will encourage reciprocal tourism and seasonal work in regional areas," she said.

New Zealand currently has working holiday agreements with over 45 countries, enabling thousands of young Kiwis to experience the world while supporting foreign economies and industries. The planned agreement with Iceland will expand that network, offering access to a country renowned for its vibrant cultural heritage and cutting-edge sustainability practices.

Double Tax Agreement Signed to Boost Business Clarity

In another key development, Mr Peters signed a Double Tax Agreement (DTA) with Icelandic Finance Minister Daði Már Kristófersson. This agreement is designed to eliminate double taxation and prevent tax evasion, streamlining operations for businesses and individuals working across both countries.

"This Double Tax Agreement will strengthen economic cooperation by providing clarity and fairness for businesspeople operating between New Zealand and Iceland," Mr Peters explained.

The agreement provides legal certainty in cross-border investment, reduces administrative hurdles, and aligns with global efforts to improve transparency and equity in international taxation.

Geothermal Energy Collaboration: Learning from the Best

Peters' visit also took him to Iceland's Nesjavellir Geothermal Power Station, where he met with Icelandic Energy Minister Jóhann Páll Jóhannsson. The visit underscores New Zealand's intent to learn from Iceland's global leadership in geothermal energy and explore how similar models can be adapted to New Zealand's energy landscape.

"Geothermal could help secure New Zealand's future energy needs," Mr Peters said. "That's why it's critical we learn from world leaders like Iceland."

New Zealand is investing in the exploration of supercritical geothermal energy in the Taupō Volcanic Zone, an area with immense potential for clean, renewable energy. Iceland, which sources nearly 90% of its energy from renewable sources—especially geothermal and hydroelectric—serves as a natural partner for knowledge exchange and technical collaboration.

Strengthening Ties with the Nordic Region

Mr Peters' Iceland visit is part of a broader diplomatic mission to the Nordic countries, including Norway, Denmark, Sweden, and Finland. The tour reflects the Coalition Government's commitment to diversifying foreign relations, expanding trade and energy partnerships, and promoting youth and professional mobility.

These announcements follow the Government's broader foreign policy agenda to modernize New Zealand's global engagement, particularly in regions aligned with its values of democracy, sustainability, and innovation.