New Zealand breaks from Western Empire, becomes first Five Eyes country to join China’s Belt and Road project
17 September 2019
New Zealand has broken away from its western intelligence allies with an offer to support China’s contentious global infrastructure and investment project.
The Belt and Road initiative involves Chinese state banks offering funds to develop transport schemes around the world to facilitate trade.
Supporters present it as a development initiative but critics say it is primarily to advance Beijing’s strategic interests, and even a form of “debt colonialisation“. Beijing has recently tried to recast the programme, promising to improve standards and transparency.
Jacinda Ardern, the New Zealand prime minister, said she believed the scheme had “really evolved” and her government was prepared to offer Beijing advice on expanding it. Her trade minister, David Parker, said that New Zealand believed that it could “find a win-win situation with China”.
The shift overrides the reservations of Winston Peters, Ms Ardern’s foreign minister, and follows concerns about the encroachment of Chinese technology into the Five Eyes intelligence network, which comprises New Zealand, the UK, the US, Canada and Australia.
New Zealand has traditionally had friendly relations with China, signing a free-trade agreement in 2008, the first signed by Beijing with a developed country.
China is New Zealand’s second largest trading partner and prime market for its dairy exports. It recently became the first western nation to join the Chinese-inspired Asian Infrastructure Investment Bank, which is seen by some as a rival to the IMF and the World Bank.
The G7 countries – the US, Canada, Britain, France, Germany, Italy and Japan – have questioned the transparency and intentions behind China’s initiative, but in March Italy became the first member of the group to sign up.
“The fact that we’ve taken a little bit of a pause as we’ve worked to really flesh out that arrangement has been no bad thing because Belt and Road has really evolved,” Ms Ardern told a business conference.
Mr Parker said New Zealand could offer expert advice on regulation, transparency and environmental issues. The country has criticised some of China’s lending to the Pacific region, and has refused to allow Huawei, the Chinese technology company, to take part in its 5G data network.
New Zealand pivots on how
to deal with China
7 July, 2020
When it became clear that China was pressing ahead with its encroachment on Hong Kong, the “Five Eyes” countries discussed a joint statement condemning the rapid erosion of freedoms in a city that was supposed to have those safeguards until 2047.
But when the statement came out, only four of the countries the United States, Britain, Canada and Australia had signed it. New Zealand released its own, separate statement, worded almost identically.
It was a sign of how, under Prime Minister Jacinda Ardern, New Zealand is re-calibrating its dealings with both Beijing and Washington and walking a tightrope.
After almost a decade of becoming ever more economically dependent on China, the Pacific nation of 5 million is seeking an elusive middle ground where it can be critical when its values demand, but without hurting its economic interests. This is harder still as China’s authoritarian leadership shows increased willingness to mete out economic punishment and take political hostages, sometimes over the slightest perceived criticism.
“China has changed under Xi Jinping and we need to adjust the way we respond and work with China,” said Rodney Jones, a New Zealand economist who worked in Beijing for years. “It’s become about common interests and trade rather than any kind of friendship.”
Like many Western democracies, New Zealand has come to the realisation that China’s economic rise has not, as many hoped, led to political liberalisation. Beijing’s moves on Hong Kong and its human rights abuses in the Xinjiang Region, both driven by Xi, are evidence of that.
New Zealand was the first developed country to sign a free-trade agreement with China, inking a deal in 2008 that helped it dodge the brunt of the financial crisis.
Since then, and particularly during the nine years led by a centre-right national government, most of them under former investment banker John Key, New Zealand enjoyed booming trade with the Asian giant.
Its goods exports to China’s 1.4 billion strong consumer market quadrupled; China now buys one-third of New Zealand’s dairy and seafood exports, almost half its meat and wool, and almost 60 percent of its logs and timber.
Migration to New Zealand surged, with students flocking to universities and rich Chinese snapping up investor visas. Before the novel coronavirus hit, China was forecast to overtake Australia as New Zealand’s largest source of tourists within the next three years.
This period also came with a growing sense, especially among big exporters, that New Zealand could not say anything negative against China for fear of upsetting the apple and milk and lamb and kiwi fruit cart.
Under Key, New Zealand became the first Western nation to sign on to Beijing’s Asian Infrastructure Investment Bank and the Belt & Road Initiative, two of Xi’s signature policies.
But a reappraisal has occurred in the past three years as Xi has led China back toward authoritarianism, and after New Zealanders elected Ardern’s centre-left coalition in 2017.
“I feel things are rebalancing a bit from the previous nine years, which were reasonably uncritical,” said Helen Clark, who was prime minister when New Zealand signed the trade deal with China and has a close relationship with Ardern.
Now Ardern’s government is trying to walk a fine line.
Since the Key years, New Zealand has become “cleareyed” about how China functions as a state, said one government insider who spoke on the condition of anonymity to discuss internal conversations.
Ardern raised the issue of human rights abuses in Xinjiang directly with Xi during her visit to Beijing last year but behind closed doors. There have been statements on the increasing repression in Hong Kong, and calls for Taiwan to be readmitted to the World Health Assembly, even as Ardern said New Zealand still recognised that Beijing had a “One China” policy.
Her government has also framed the decision over whether to allow Huawei gear in New Zealand’s 5G network as country-agnostic and one to be made by bureaucrats, not politicians.
And there has been a shift in the way New Zealand’s government talks about military issues, including Beijing’s military buildup in disputed waters. David Capie, Director of the Center for Strategic Studies at Victoria University, referred to a 2018 white paper that used much more forthright language than previously.
“The Strategic Defence Policy Statement broke new language in the way we talked about China in the South China Sea,” he said. “It was not hairy-chested Pompeo-style speech, but it’s all there,” he said, referring to U.S. Secretary of State Mike Pompeo.
While criticising China in some areas, New Zealand has made sure to find areas where they can cooperate on climate change and at the World Trade Organisation, for instance to “provide some ballast in the relationship,” the government insider said.
“We don’t want to be seen as supine because of economic dependency,” he said. He characterised New Zealand’s China policy as “engage but … ”
But Key said it was because of the strong economic relationship that the diplomatic one could evolve. “Now we are more interlinked by trade, so you would hope all parties can find a more mature and better way of dealing with issues,” he said in an interview.
In talking about how New Zealand can make difficult but necessary decisions, analysts and officials here hark back to New Zealand’s 1984 decision to ban nuclear-powered ships from its waters.
This effectively barred U.S. Navy vessels and led New Zealand to be frozen out of ANZUS, the military alliance with Australia and the United States. But to this day, New Zealand’s nuclear-free policy has overwhelming support here, despite the costs.
“We’ve been known as a country that speaks its own mind,” Clark said in an interview. “New Zealand foreign policy is at its best when people think, ‘The Kiwis are saying that they’ve figured that out themselves, they’re not acting on behalf of anyone else.’ ”
Tony Browne, New Zealand’s ambassador to Beijing until 2009, said the nuclear-free decision gave the country “a lot of latitude to take positions without the constraints of an alliance relationship” and could be applied to China today.
But the challenge now is to chart a path without suffering the same blowback as countries such as Australia and Canada.
After Australia called for an inquiry into the origins of the coronavirus, China blocked its barley and beef exports. Ardern waited until a coalition of dozens of countries was ready to seek an inquiry before backing one, and said New Zealand was not interested in a “witch hunt.”
After Canada arrested Huawei Chief Financial Officer Meng Wanzhou at the request of the U.S. Justice Department, China curbed imports of Canadian canola and pork and detained two of the Country’s Citizens.
Businesses here are uneasy about the shift to a more nuanced approach toward China. As the coronavirus raged, a group of primary goods exporters wrote to Ardern, urging her not to allow any damage to the relationship.
New Zealand has to deal with China “as it presents in the world today,” even when that doesn’t match New Zealand’s hopes for China, said Stephen Jacobi, head of the New Zealand International Business Forum, which represents some of the nation’s largest primary exporters, including the milk giant Fonterra and fruit, seafood and meat producers.
“New Zealand has a lot at stake in this relationship,” Jacobi said. “We have no domestic market to rely on. We cannot replace Chinese consumption anywhere else in the world.”
But others, such as Browne, the former ambassador to China, say New Zealand can’t afford to ignore its values. “The navigation up to this point has been very astute,” he said, “but the middle road is a hard one to follow.”
Anna Fifield, The Washington Post’s Bureau Chief in Beijing, writing
about all aspects of China. She was the Post’s Bureau Chief in Tokyo between
2014 and 2018, writing about Japan and the two Koreas. She is the author of
“The Great Successor: The Divinely Perfect Destiny of Brilliant Comrade Kim
The NZ media.
Never mind the sovereignty. It’s all about making the world
What on earth is China’s Belt and Road?
30 May, 2019
The Belt and Road Initiative is China’s trade policy enigma. Its intention is to
promote infrastructure growth in developing countries to aid international trade
The superpower is investing trillions of dollars to widen and bolster its military and geopolitical strategy.
The policy was introduced by President Xi Jinping in 2013 and embedded in the
constitution four years later. Since then, over 150 countries have expressed their
interest in the BRI.
Journalist Jeremy Rees has been told by a Chinese economist to “think of it as a
philosophy rather than a policy”.
The lack of a concrete and transparent policy has created an air of ambiguity.
“Anything that can increase the infrastructure of countries and link them to China,
is the policy, but having said that – everything seems to come under belt and
road,” says Rees.
In Fiji, plans for a luxury resort have been pulled after the developer, Freesoul,
was accused of environmental destruction and failing to gain the correct permits.
Similar accusations have been made by environmentalists of projects in parts of
Pakistan, Africa and Thailand.
But it can be difficult to point the finger at the Chinese government.
Dr Jason Young, a political scientist from Victoria University of Wellington says
not all projects are publicly tied to BRI.
“There could be questions of commercial sensitivities of some of the companies
involved,” says Young.
But Young agrees transparency is vital; to be environmentally liable, to prove
economic ties, is in China’s best interest.
New Zealand has signed a non-binding memorandum of agreement to explore
infrastructure projects that would strengthen ties with the Peoples’ Republic.
Dr Young says there has been some hesitation to jump onboard.
With mounting criticism of the policy: as a debt-trap for developing nations and as
environmentally irresponsible, BRI is starting to lose favour.
President Xi Jinping took to the podium at the recent BRI forum and assured
world leaders projects would be clean, green and sustainable.
That assurance appears to have worked, with Trade Minister David Parker, on
returning from the forum, saying he was in favour of starting projects.
There are no BRI projects in New Zealand as yet, but perhaps not for long – with
the Chinese looking at rail investment in particular.