China policy in New Zealand and Australia - with Jason Young

Guest: Jason Young, Acting Director, New Zealand Contemporary China Research Centre, Victoria University of Wellington

Host: James Laurenceson, Deputy Director, Australia-China Relations Institute (ACRI), University of Technology Sydney

New Zealand and Australia are geographically close, and similar in many ways. When it comes to China policy, there are similarities but also important differences. Both countries have witnessed intensifying debate about Chinese Government influence or interference; the extent to which our countries should be involved in the Belt and Road Initiative (BRI); and the overall direction of our foreign policies between our long-standing alliances with the US and increasing economic reliance on China.

How does the current New Zealand Government characterise its relationship with China? Has New Zealand’s attitude towards China’s aid in the South Pacific changed over time? What is New Zealand’s position on the BRI, and what does it hope to gain in negotiations of an upgrade to its free trade agreement (FTA) with China?

Jason Young joins James Laurenceson to discuss what New Zealand and Australia can learn from each other as their relationships with China evolve.

Despite changes and challenges in the New Zealand-China relationship, New Zealand remains consistent, pragmatic and proactive in its China policy. As a small country, pragmatism is particularly important. New Zealand’s Prime Minister Jacinda Ardern has described the relationship as being 'in great shape. Politically we are in close touch. Economically we are doing great things together. And our people-to-people links are growing day by day.' This statement reflects the ‘baseline’ of New Zealand-China relations; political communication does not mean that both sides agree on all issues, but they are engaged in discussion on important matters.

New Zealand’s so-called ‘Pacific reset’ constitutes a turn towards being a partner rather than simply a donor in the region. New Zealand wants Pacific nations to flourish on their own terms, and its recently released government budget demonstrates a renewed commitment to the region’s success. New Zealand has concerns about the scope, scale and speed of change in terms of China’s involvement in the region and the types of projects China sponsors. It is also closely watching project governance and quality, as well as debt levels.

On the BRI, New Zealand is not focused on infrastructure investment, which is more relevant to developing countries. Instead, New Zealand pursues engagement with the BRI primarily in terms of policy coordination, cultural exchange, multilateral cooperation, and trade and customs facilitation. In some contexts, New Zealand will be no more than a keen observer of the BRI, and its Memorandum of Arrangement enables it to pick and choose the areas to which it can add value.

New Zealand and China are pursuing an upgrade of their bilateral FTA. New Zealand hopes to realign the FTA to reflect the contemporary economic relationship, which has experienced significant changes since the FTA came into force 10 years ago. There is room for improvement in emerging industries and areas, such as e-commerce, cross-border transactions, and biosecurity issues arising from individual traders.

The manner in which the subject of political interference is discussed in New Zealand deserves scrutiny. A clearer distinction should be made between ‘interference’ and ‘influence’. China, like other countries, exerts a level of influence on New Zealand. Allegations of interference, however, are more serious. Despite strong views, empirical discussion to date has been weak and the bar has not yet been met for a clear statement about Chinese Government interference in New Zealand’s political system.

Australia and New Zealand both have a duty to uphold their democratic institutions, while finding a way to deal with China and its political system. Both countries have a need for China expertise. Furthermore, those with the highest levels of knowledge and experience do not currently get the airtime they deserve.

Theme music by Sam J Mitchell.

May 31 2018