Auckland Mayor Len Brown says an alliance among seven North Island councils will boost productivity.
Seven councils signed an agreement on Saturday to collaborate on inter-regional issues such as economic development and transport.
The Upper North Island Strategic Alliance comprises the Northland, Waikato and Bay of Plenty regional councils, the Auckland, Hamilton and Tauranga city councils and Whangarei District Council, representing a combined population of 2.3 million.
Mr Brown says the alliance will boost the contribution of the top half of the North Island to the nation's economy.
He says he felt that it was critical to formalise what had been a good informal relationship for the purpose of adding value to economic growth and relationships.
Meanwhile, Hamilton mayor Julie Hardaker says the entire country will benefit from the newly-formed alliance.
Ms Hardaker says it represents "the powerhouse of New Zealand" and recognises the benefit of coming up with strategic objectives together that benefit the regions and New Zealand as a whole.
The group has no decision-making authority but can make recommendations to central government.
