SYDNEY (BLOOMBERG) - In a bid to boost its struggling tourism industry, Australia announced on Friday (Oct 2) that New Zealanders will be allowed to visit parts of the country without having to undergo quarantine.

From Oct 16, New Zealanders will be able to visit New South Wales state and the Northern Territory, Deputy Prime Minister Michael McCormack told reporters.

"We want to open Australia up to the world," he said. "This is the first part of it."

Australia closed its borders in March in an effort to control the coronavirus, and returning citizens and residents have to undergo 14 days of hotel quarantine under tight security.

While the nation has largely controlled community transmission, other than a resurgence in Victoria state, the border closure has decimated international tourism and also crushed a university sector that's grown increasingly reliant on overseas students.

It's a picture repeated elsewhere in the world, and other nations have been trying to open travel bubbles to boost their economies, even as they grapple with new waves of the virus.

While shares in Air New Zealand and Qantas Airways rallied on the news on Friday, it's only an incremental step to reopening and falls short of the "trans-Tasman bubble" envisaged between the two neighbours.

New Zealand, which eliminated local community transmission earlier this year and swiftly brought a more limited outbreak in Auckland under control, is keeping its border shuttered.

Prime Minister Jacinda Ardern has made clear that if her countryfolk do travel to Australia, they will have to quarantine on their return home. Indeed, she has urged them to spend their tourist dollars in New Zealand instead.

Shares in Air New Zealand rose as much as 7.2 per cent in Wellington trading, the most in three months. Qantas reversed losses to trade 1.7 per cent higher at 2.26pm in Sydney.