Is New Zealand’s relationship with China on the rocks?

China's President Xi Jinping (R) shakes hands with New Zealand's Prime Minister Jacinda Ardern before their meeting at the Great Hall of the People in Beijing on April 1, 2019. Source: Kenzaburo Fukuhara/Pool/AFP

ByJason Young-6th May5 

EARLY April 2019 saw New Zealand Prime Minister Jacinda Ardern travel to Beijing for her first state visit to China. The visit included high-level meetings with Chinese President Xi Jinping and Premier Li Keqiang, reinforcing previous government’s efforts to develop constructive relationships with regional partners.

Travelling so soon following the 15 March Christchurch terrorist attack attests to the priority New Zealand places on managing relations with China. Considering the challenges New Zealand’s closest partners are facing and New Zealand’s similarly shifting debate on China, the visit came at an opportune moment for both countries.

Before the trip was announced, New Zealand and international media ran headlines suggesting relations with China were on the rocks. This followed a number of delays in official visits and an Air New Zealand plane turning back from a scheduled flight to Shanghai.

New Zealand’s usually bipartisan approach to China even broke down momentarily as the National-led opposition criticised the coalition government’s handling of the relationship. Talk show hosts called it how they saw it and Australian commentators argued New Zealand had joined Australia in the diplomatic doghouse.

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But there was no official statement to support this view and no evidence that the economic relationship has been impacted. China maintains its spot as New Zealand’s top goods and services trade partner, with a considerable trade surplus for New Zealand.

While the state of the relationship was being debated publicly, New Zealand officials were busy working towards building resilience and maturity in the relationship. Negotiations to upgrade the 2008 Free Trade Agreement continued as memorandums for greater cooperation on double taxation, climate change, science and research were drafted and negotiated. The work plan for New Zealand participation in the Belt and Road Initiative rumbled on.

Nevertheless, many are not persuaded by messaging from both governments that continues to stress engagement and proactive resolution of issues.

Arguably then, the most important outcome of the state visit was to demonstrate, in the words of the Prime Minister, that “China is an important and valued partner” and that “New Zealand is committed to sustaining a constructive and comprehensive relationship.”

China’s President Xi Jinping (L) attends a meeting with New Zealand’s Prime Minister Jacinda Ardern (2nd R) at the Great Hall of the People in Beijing on April 1, 2019.
Source: Kenzaburo Fukuhara/Pool/AFP

But as previous months have shown, maintaining a constructive and comprehensive relationship with China will remain challenging as New Zealand learns to deal with a more confident China increasingly engaging the world on its own terms and in the context of an intensified US–China rivalry.

Such challenges come to a head over the proposed use of Huawei technology in the development of New Zealand’s 5G telecommunications network. Last year the Government Communications Security Bureau (GCSB) rejected a bid by a New Zealand company to use Huawei gear on the grounds that it identified a “significant network security risk.”

This intensified the debate about China in New Zealand, adding fuel to the international debate on China and leading to much lobbying and creative advertising on the part of Huawei in New Zealand.

During the Prime Minister’s state visit, President Xi stated that the ‘two sides must trust each other’, while Premier Li conveyed his wish that “the business communities of both countries enjoy a more enabling and more transparent environment.”

These statements signal unease with the Huawei decision in Beijing but should also be taken in a context where Huawei is already deeply invested in, and continues to invest in, New Zealand’s telecommunication network.

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Huawei will need to satisfy the GCSB’s risk assessments — as companies from all jurisdictions must — to move into the 5G network. If it cannot meet these requirements, New Zealand must explain clearly how such a decision is neither a blanket ban nor a move to discriminate against investment from China — something New Zealand legislation does not allow.

The danger is that the Huawei bid gets mixed up in the heated narrative around a US–China tech battle and the US shift toward strategic competition with China.

New Zealand’s own strategic anxieties also play into this narrative.

The June 2018 Strategic Defence Policy Statement publicly raised concern over New Zealand’s changing security environment and the return of great power rivalry in the region. The following December, Foreign Minister Winston Peters called for more US attention and involvement in the Pacific. He stated that the Asia Pacific is “more contested”, “more fragile” and reaching “an inflection point… that requires the urgent attention of both Wellington and Washington.”

New Zealand Prime Minister Jacinda Ardern (C) walks with Chinese Premier Li Keqiang (R) during a welcome ceremony at the Great Hall of the People in Beijing on April 1, 2019. Source: Greg Baker/AFP

China’s own policies — such as the concerning reports of ‘re-education’ camps in Xinjiang, stricter controls on media and intellectual freedom, and its actions in the South China Sea — do little to counter this narrative.

Such changes in China — and among New Zealand’s partners’ approaches to China, especially Australia’s — have rebalanced New Zealand’s attention to seeking a more mature and comprehensive relationship. This involves disagreements being dealt with constructively and frank conversations being had.

As the Prime Minister’s visit shows, it is unlikely that New Zealand policy will move away from the goal of sustaining a constructive relationship with China. New Zealand remains reluctant to seek regional architecture that excludes China or other major regional powers.

Promotion of an inclusive rules-based regional order and the pursuit of interest through engagement is part of the DNA of New Zealand foreign policy.

Dr Jason Young is the Director of the New Zealand Contemporary China Research Centre and an Associate Professor of International Relations at the Victor.

This article is republished from East Asian Forum under a Creative Commons licence.