New Zealand faces balancing act between U.S. and China over AUKUS

WELLINGTON, New Zealand – New Zealand Prime Minister Chris Hipkins was given the red carpet treatment in Beijing last week when Chinese leader Xi Jinping called the smaller country a “friend and partner”.

New Zealand’s economy may be one seventy-seventh the size of China’s, but the relationship is important to Beijing, Xi told Hipkins. “We must continue to see each other as partners rather than adversaries, opportunities rather than threats,” he said in the lavish Great Hall of the People.

It looked like a clear effort by Xi to make sure New Zealand, often considered the “soft bank” of the Five Eyes intelligence-sharing partnership, remembers whose bread it’s on.

The dairy and meat export economy is overwhelmingly dependent on the Chinese market, but has so far escaped the kind of economic retribution inflicted on the other Five Eyes nations as punishment for political misdeeds.

But New Zealand’s efforts to walk the tightrope between its security partnerships in the West and its economic dependence on China will be increasingly difficult to sustain.

This is especially the case as efforts to persuade him to sign on to the next phase of the AUKUS alliance, which began as a nuclear-powered submarine agreement between Australia, the United Kingdom and the United States, designed by keep China under control.

Beijing has objected vehemently, saying the United States is trying to forge new “NATO-like” alliances in Asia.

New Zealand’s two foreign policy principles: “good global citizen; small trading nation” — they are an “inadequate moral and strategic compass” as the rules of the international order are being challenged by dominant powers, said Van Jackson, a former Pentagon official who now teaches international relations at the Victoria University of Wellington.

Further complicating New Zealand’s calculations: It remains a decidedly nuclear-free nation, and there is a whiff of uranium around the AUKUS deal, although the second phase, “pillar two”, seeks to share advanced non-nuclear technologies, including artificial intelligence, quantum computing. , cyber capabilities and electronic warfare.

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The AUKUS issue will become increasingly urgent as other partners step up efforts to get like-minded countries to join their effort to limit China’s expansion in the Pacific, and New Zealand faces some general election set for October.

Kurt Campbell, the White House’s Indo-Pacific coordinator, encouraged New Zealand to sign up to “pillar two” of the deal when he was here in March, a message Australian Prime Minister Anthony Albanese reiterated during a meeting with Hipkins the following month. They have been at pains to stress to New Zealand that there is no nuclear weapons capability for submarines.

New Zealand was “willing to explore” the idea of ​​signing the second pillar, Defense Minister Andrew Little said at the time.

Major changes in foreign policy are unlikely before national elections in October.

The main centre-right opposition National Party has not publicly commented on the pact, and leader Christopher Luxon did not respond to a request for comment.

But the prospect of signing up to any part of AUKUS is causing consternation in Wellington over whether New Zealand’s go-it-alone approach to foreign policy, which has its origins in the anti-nuclear movement of the 1980s, is good enough at the same time. of growing global tensions.

“New Zealand is part of the regional [Indo-Pacific] architecture But that’s different from having a strategy,” Jackson said.

“Does this choice of foreign policy increase the forces of rivalry? Does it increase a new Cold War or decrease these things? Does it increase the autonomy of smaller states? These kinds of questions are not asked.”

Several former New Zealand political leaders have spoken out strongly against any local involvement in AUKUS, worried about the consequences of becoming embroiled in a competition between the two superpowers. And, they have expressed concern about whether new nuclear-powered submarines could increase instability and nuclear risk in the Indo-Pacific.

“Participation in AUKUS would entail a risk [New Zealand’s] independent foreign policy and potentially its nuclear-free component as well,” said Helen Clark, a former minister who was one of the key political figures involved in developing New Zealand’s ban on nuclear-armed warships in the eighty. “It could also have adverse economic implications,” he said.

The nuclear issue has been downplayed by US and Australian officials, who say the highly enriched uranium that powers the submarines will be sealed and cannot be turned into weapons.

However, Wellington has confirmed that a ban on nuclear-powered ships would prevent port visits by submarines. Australia is New Zealand’s only formal military ally.

New Zealand’s history of nuclear disarmament dates back to the 1970s, when the government sent a frigate to the Pacific to protest French nuclear tests. (Then-Prime Minister Norman Kirk told the crew that their role was to “bring the consciousness of the world to life.”)

Wellington’s refusal to allow port calls by nuclear-armed warships led Washington to withdraw its security guarantees under a post-World War II treaty known as ANZUS in 1986; a fracture that lasted 30 years. (At the time, Clark said, “It feels good to be in control of your own affairs and not be dictated to from a foreign capital.”)

The legacy of that decision is a latent anti-Americanism that underpins Wellington’s skepticism toward forging new military deals with the United States, even though the countries remain relatively close.

“There’s a bit of the ‘ghost of the ANZUS disputes past’ that haunts this,” said David Capie, director of the Center for Strategic Studies at the University of Victoria. “People see a possible deepening of a military relationship with the United States as undermining the so-called independent foreign policy.”

There are signs that Wellington is aware of the growing geopolitical risks and is recalculating its own strategic role in the Pacific.

Little said last month that small liberal democracies “cannot escape the real effects of geostrategic competition”.

“New Zealanders must be prepared to equip ourselves with trained defense personnel, assets and materiel, and appropriate international relationships to protect our national security,” the defense minister said in a speech at the Shangri-La Dialogue, a Asian Security Summit in Singapore.

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But economically, New Zealand remains overwhelmingly dependent on China. Since becoming the first Western country to sign a free trade agreement with China in 2008, trade has grown as China’s growing middle classes have taken New Zealand’s agricultural products and they went to their tourist spots and universities.

Its exports to China increased approximately eightfold between 2008 and 2022, with China overtaking Australia as New Zealand’s largest export destination in 2013.

But that moment in 2008 was “atypical” and “certainly not something to base a country’s foreign policy on,” said Nicholas Khoo, an expert on New Zealand-China relations at the University of Otago.

“Unfortunately for us, the era of having your cake and eating it is over and so we have to make some very difficult decisions,” Khoo said.

Even amid growing recognition of the risks of relying too much on China, and the prospect of its authoritarian leadership using trade as a political tool if New Zealand does something it doesn’t like (like joining AUKUS ), the smallest country has not made progress towards diversification.

In fact, Hipkins’ first visit to Beijing as prime minister looked like a trade mission, with business leaders representing sectors from dairy and fisheries to education and gyms all trying to grow their trade with the china

The trade focus of the visit, and Xi’s characterization of New Zealand as a “friend and partner,” underscores that “trade occurs in a strategic context,” Khoo said.

Joining AUKUS could give Wellington “foreign policy insurance”, he said, at a time when Beijing’s strategic relationships globally are under strain.

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