Sporting rivalries aside, the success of Australia is critical to that of New Zealand.

John Key went into full sledge mode when he roasted Tony Abbott at a gala dinner to mark the joint hosting of the Cricket World Cup.

New Zealand had given a lot to Australia: "Crowded House, the pavlova, Phar Lap and Abbott's wife Margie" (as well as a string of Key-chosen sporting defeats).

For Australia's part, all it had given New Zealand in return was "Russel Norman and the Queensland fruit fly".

The sledging was deliberate. Key had warned Abbott he would be rolling out the jokes to break the palpable tension where the table chatter had been as much about his Australian counterpart's potential longevity as Prime Minister as who would win the forthcoming match between New Zealand and Australia.

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Abbott got in a couple of good-natured sledges of his own.

But he looked slightly rueful when Key noted: "When you have relations you don't have to look behind ... Your family has got your back."

The fundamental problem is that while Australia and New Zealand may indeed be "family", Abbott is the third Australian Prime Minister in a row who does not enjoy the backing that counts - that of his party room.

There was plenty of good-humoured banter when the two Prime Ministers earlier addressed the 10th meeting of the Australia New Zealand Leadership Forum - a 160-strong group of leading business people.

But there was also some succinct messaging.

From Key: That the low-hanging fruit from the Closer Economic Relations agreement between the two countries had been plucked. Politicians from both sides had not been focused on the next steps and it was time to consider some bold actions to galvanise what Australasia could do as a whole to take advantage of its combined position with the rest of the world.

Abbott launched his own arsenal: Australia was performing well: expected GDP growth of 2.9 per cent this year, exports up 7 per cent and plenty of housing starts.

But his was a linear view of where Australia sits. He did not paint the story of his country's economic present and future. And from discussion round the forum fringes, not many Australian business leaders were convinced his tenure would be a long one. Much of the fringe talk was about whether Malcolm Turnbull or Julie Bishop would replace him.

Abbott's inability to pitch a convincing story to his own countrymen clearly puzzled Key, who took an opportunity at their joint press conference to praise the Australian leader for taking some tough decisions. There was a "just suck it up" tenor in Key's comments, which were made in the presence of the Australian media.

What Abbott did paint vividly - again at the press conference - was the rationale for Australia venturing into Iraq.

The nature of his leadership is affecting senior Australian business leaders' view of Australia's place in the world. They don't like the external image Australia is presenting: one of political instability and revolving-door prime ministerships against a background where Australians themselves do not appear willing to support their Government to take the necessary steps to get the books in order and tackle some fundamental economic micro-reforms.

They contrasted Key's leadership favourably with that of Abbott - there was also a sense they thought Bill English had made a better fist of the finance role than the Australian Treasurer, Joe Hockey.

This may be a matter of timing.

When the Key-English Government set about its reform programme it was against the background of recession and the global financial crisis.

Australia's problems are more fundamental. It has lost its status as Asia's quarry and the rolling wealth that underpinned years of prosperity. It has to develop new opportunities.

Just what those opportunities are is a question challenging not just Australia itself but those who argue that an Australasian face could be presented externally in defined areas to seize opportunities from the combined scale that Australia and New Zealand can muster.

Forum co-chairman Adrian Littlewood - who also took part in a private business breakfast with the two Prime Ministers - reckons that while CER has achieved a lot, it is time to look at whether "we could work in a much more open way towards the rest of the world".

Littlewood, who is also chief executive of Auckland International Airport, adds a caveat that business itself should be looking to define the big goals and opportunities that the sectors can align around rather than expect the two governments to do the heavy lifting.

He uses the example of how the two countries' tourism players go abroad together to market Australia and New Zealand to global tourism buyers.

His third point is that there are opportunities to apply transtasman scale, for instance by jointly marketing worldwide the pipeline of infrastructure projects for both countries.

Littlewood's fundamental message - which also came through strongly in some thought-provoking addresses - was that it was time for action rather than talking.

Other opportunities to emerge for joint action included big science projects and free-trade deals.

One area that does require government action is the perennial issue of the mutual recognition of dividend imputation and franking credits. It was raised. But there was no commitment.

Judging by the rampant celebrations after New Zealand defeated Australia at the cricket on Saturday, mere collaboration will not be enough to keep New Zealand business' spirits up.

But sporting triumphs are transitory. Australia's success is critical to that of New Zealand.

In next Wednesday's column I will ask: compete, collaborate or both? and look at the challenges for Australia, and especially New Zealand.

Fran O'Sullivan attended the Australia New Zealand Leadership Forum which was held under Chatham House rules.