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Home / Business / Economy

NZ PM Christopher Luxon faces diplomatic test with China visit and Nato summit – Fran O’Sullivan

Fran O'Sullivan
By Fran O'Sullivan
Head of Business·NZ Herald·
13 Jun, 2025 09:00 PM5 mins to read

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Christopher Luxon speaks to the media before his first trip to China.
Fran O'Sullivan
Opinion by Fran O'Sullivan
Head of Business, NZME
Learn more

THE FACTS

  • Prime Minister Christopher Luxon will head to China next week.
  • Luxon will meet Chinese President Xi Jinping before heading to Nato in The Hague.
  • NZ joined Britain, Australia, Canada and Norway in imposing sanctions on two far-right Israeli Government ministers this week.

Christopher Luxon faces a major diplomatic test as he segues between meeting Xi Jinping in Beijing and going on to the Nato summit, where he’ll likely rub shoulders with Donald Trump – all without ruffling the feathers of the world’s two most powerful political leaders.

This is not an easy time to lead a small nation buffeted by the tumultuous headwinds of global trade while also operating within an increasingly tense security environment where – if you believe Nato projections – war drums are beating so hard that Russia could be ready to attack the Western alliance within five years.

Luxon has to balance a pragmatic approach to our major trading partner – China – with the knowledge that when he gets to The Hague he will enter an environment where despite its status as the No 1 trading partner of many Nato members, China has been singled out directly by Nato Secretary-General Mark Rutte as a threat.

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In a speech to Chatham House in London, Rutte bracketed China alongside Russia, North Korea and Iran as contributors to growing global instability and direct supporters of Moscow’s war effort in Ukraine.

He forecast that Russia could be ready to attack Nato within five years and has pressured leaders of the Western alliance to agree, when they meet in The Hague on June 24 and 25, to increase military spending to 5% of GDP to contain the threat.

Beijing has furiously denied Rutte’s claim.

In his meetings in Beijing next Friday, the Prime Minister will want to stress that New Zealand is both principled and pragmatic.

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The conversation with Xi will likely focus on big-picture, geostrategic matters – not simply the nuts and bolts of the bilateral relationship that will be the focus of his meeting with Chinese Premier Li Qiang.

Last year’s visit by the Premier to New Zealand was highly successful and the pair struck a cordial working relationship.

As Luxon says, “the challenging global outlook makes it vital that we are sharing perspectives and engaging China on issues that matter to New Zealand”.

At the big-picture level, New Zealand is of interest to China because it is a member of the Indo-Pacific Four – alongside Australia, Japan and South Korea – which adjoins the Nato Alliance.

This was not simply a strategic move by Luxon’s coalition Government. New Zealand was brought into the Nato nexus when former Labour leader Dame Jacinda Ardern was in power.

Although the US President and his Chinese counterpart appear to be reaching a working accommodation and have agreed on a framework to reduce trade tensions, those tensions still exist.

Xi will no doubt emphasise China’s role as a stabilising force in global trade but the security dimension will loom large. Luxon will want to canvass China’s increasing involvement in the Pacific, where competitive tensions loom large.

It is an important time in global affairs.

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Luxon and his colleagues Foreign Minister Winston Peters, Defence Minister Judith Collins and Trade Minister Todd McLay (known in political circles as “Trade McClay”) are at the apex of New Zealand’s diplomatic efforts.

Luxon ruffled feathers (particularly Peters’) when he reached out to other world leaders after “Liberation Day”, Trump’s announcement of his unilateral tariffs, to forge “coalitions of the willing” to uphold multilateral trade.

There is a significant impact on this country’s exporters from the 10% impost applied to New Zealand exports.

In general, the four Cabinet ministers have presented a united front.

In particular, ministers and their officials have kept their heads down and adopted a pragmatic yet respectful approach to the Trump administration.

This has at times led to others calling into question the Government’s claim that it is operating an independent foreign policy.

New Zealand’s decision to join Britain, Australia, Canada and Norway in imposing sanctions on two far-right Israeli Government ministers for allegedly “inciting extremist violence” against Palestinians in the Israeli-occupied West Bank illustrates New Zealand is not a poodle.

US Secretary of State Marco Rubio has said the United States condemns the sanctions imposed on the two sitting members of the Israeli Cabinet.

“These sanctions do not advance US-led efforts to achieve a ceasefire, bring all hostages home, and end the war,” Rubio said.

“We remind our partners not to forget who the real enemy is. The United States urges the reversal of the sanctions and stands shoulder-to-shoulder with Israel.”

Israel’s pre-emptive strike on Iran, which Luxon yesterday labelled as “potentially catastrophic”, simply underscores New Zealand’s judgment call.

New Zealand has stood its ground.

This will be noted not only in Washington DC.

Disclosure: Fran O’Sullivan is joining the Prime Minister’s business delegation to China and will then travel on to a study tour of the Netherlands, which is hosting the Nato summit. She is a member of the New Zealand China Council and co-hosts the annual China Business Summit.

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