China has delivered a reassuring message that the outbreak of Covid-19 will only entrench its commitment to globalisation and multilateralism.
The message was delivered by Chinese Ambassador Wu Xi at the 6th China Business Summit in Auckland this week. It was underscored by subsequent comments from Caixin financial magazine founder and publisher Hu Shuli suggesting the time was right for China to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) along with New Zealand and 10 other countries.
Hu's advocacy for China to be open towards high-standard trade pacts follows on from Premier Li Keqiang's comments during the National Congress that China holds a positive and open attitude toward joining the CPTPP. This was the first time a Chinese leader had publicly stated the country's position on the CPTPP and it made waves in the international community.
Hu is a distinguished journalist who is active in international think tank forums and was named one of the world's greatest leaders by Fortune magazine in 2017.
Speaking by video from Beijing, Hu said China's experience of joining the World Trade Organisation showed that even when some demands look out of reach "they can actually be met if we really stretch ourselves.
"The significant progress made on ... government reform, trade zone construction, phase one of the United States-China trade agreement, and an array of other trade and investment agreements that have either been signed or are under negotiation, all make the conditions for China's entry into the CPTPP more mature.
"There are definitely hurdles, ranging from state-owned enterprises to data security. But other countries with similar social systems and at similar developmental stages to China have already made the leap. China should once again open its arms to embrace the world and proceed with confidence," she said.
The CPTPP was signed by trade ministers in March 2018 in Chile. The signatories were Japan, Vietnam, Malaysia, Singapore, Brunei Darussalam, Canada, Mexico, Chile, Peru, Australia and New Zealand.
Those economies account for more than 13 per cent of the world gross domestic product worth US$16 trillion ($24t). They are also the destination for 30 per cent of New Zealand's goods exports worth nearly US$17 billion and 30 per cent of services exports worth more than US$7b.
Hu underscored that isolation is not the answer to the economic damage wrought by the coronavirus pandemic. She cited the turbulence in United States-China relations, as well as rising anti-globalisation and protectionism around the world as issues to be confronted.
The IMF has forecast that the global economy will shrink by 4.9 per cent this year, but China will grow by 1 per cent. NZ goods exports to China have recorded some declines through the pandemic but meat exports to China grew 24 per cent in May and 16.8 per cent in April, compared to the same time last year, and dairy exports were up almost 25 per cent in the first five months of 2020.
While tourism and export education sectors are at a standstill the goods trade with China is a gift that keeps giving.
Wu's steadfast rehearsal of China's statement on its sovereignty in relation to Hong Kong and other "internal" issues made for sharp newsmedia fodder. Particularly as Prime Minister Jacinda Ardern had already raised New Zealand's "principled"concerns about the recent Hong Kong security law and the Uighur Muslim people in Xinjiang.
These are serious points. But the relationship at an economic level is still relatively strong. Wu suggests China and New Zealand should take advantage of the free trade agreement upgrade to expand co-operation in new areas such as health care, quality food, e-commerce and aged care. Leveraging the planned Hainan province free trade zone also got a mention, as well as exploring the opportunity to leverage the potential of a proposed "Southern Link" with New Zealand acting as a hub between Asia (including China) and South America.
There was more besides: China has joined in the supply chain connectivity initiative launched by New Zealand and Singapore. Wu also suggested New Zealand and China work to promote the full conclusion of negotiations on the Regional Comprehensive Economic Partnership (RCEP) which links the Asean nations, with China, Japan, South Korea, Australia and New Zealand. India remains an outlier.
And in a nod to New Zealand's year as host of Apec, said China would like to work closely with NZ leading up to Apec 2021 and beyond to inject more dynamism and credibility into regional economic co-operation.
With protectionism rising in the Asia-Pacific region in the wake of Covid-19, New Zealand will need all the help it can get to host the leaders' summit virtually and ensure the regional agenda moves forward.
Fran O'Sullivan founded the annual China Business Summit in partnership with the Auckland Business Chamber.