New Zealand did not join Canada, the UK, the US and Australia in a joint declaration condemning China's national security legislation on Hong Kong although Deputy Prime Minister Winston Peters did reiterate the government's "deep concern" about the situation.

New Zealand is a member of the Five Eyes intelligence alliance with those four countries.

"On important issues like this, New Zealand will sometimes decide to join other like-minded countries and sometimes to make a statement alone," a spokesperson for the Minister of Foreign Affairs said.

"What is important is that we share the deep concerns expressed by other democratic countries in their statements overnight about the introduction of this legislation. This is clear from Minister Peters' statement."

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David Mahon, executive chair of Mahon China Investment Management, said it was a good choice not to sign the joint agreement.

He noted the Five Eyes commitment was to share intelligence. It was not a treaty or an arrangement that carried defined obligations.

Mahon said the situation in Hong Kong was highly complex.

Navigating difficult waters

"For New Zealand not to have signed this shows thoughtful restraint," he said. "As a non-action, I think it's positive."

The government is doing its "best to navigate what are going to be increasingly difficult diplomatic waters. This seems to me a good choice."

Tensions between China and the US, and China and Australia and to some extent New Zealand have been fraught of late after the US pinned the blame for Covid-19 on China and Australia backed an inquiry into its role in spreading the coronavirus.

Taiwan's bid for inclusion in the World Health Organisation only added to the tensions, in particular after a string of provocative comments by Peters, relating to Taiwan's desire to revive its WHO observer status.

At the time, NZ International Business Council executive director Stephen Jacobi said New Zealand dairy and other exporters should be "very concerned" at the way Peters was actively raising the temperature with Beijing on an "existential issue" for the Chinese government.

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"NZ-China relations are under strain," he said. Mahon said subsequent comments from Prime Minister Jacinda Ardern that New Zealand had always taken a "one China policy" helped smooth the waters.

Deputy Prime Minister Winston Peters. Photo / Mark Tantrum
Deputy Prime Minister Winston Peters. Photo / Mark Tantrum

Waiting for Trump

However, in a contribution to Politik last week, China's ambassador to New Zealand Wu Xi said the bilateral relationship was at "a crossroads" and principles like the one-China policy should be "firmly abided by."

Trade and foreign policy adviser Charles Finny said there could be several reasons why New Zealand didn't sign the four-party statement.

"There are multiple explanations. Time zones, coordination difficulties, logistics is one set," he said.

"Maybe New Zealand wants to be seen as acting independently on this matter vis a vis China. Or maybe we could not reach an agreement on the language in the other statement, so we chose to go alone."

The main difference between the statements is that Peters did not stress the new security law is in direct conflict with China's international obligations but rather emphasises that New Zealand has a "strong interest in seeing confidence maintained in the 'one country, two systems' framework under which Hong Kong is assured of a high degree of autonomy."

Meanwhile, markets are poised to see what US President Donald Trump has up his sleeve after announcing he would give a press conference on China in the US on Friday.

Earlier this week the US State Department said it no longer considers Hong Kong to be autonomous from China.

"After careful study of developments over the reporting period, I certified to Congress today that Hong Kong does not continue to warrant treatment under US laws in the same manner as US laws were applied to Hong Kong before July 1997," Secretary of State Mike Pompeo said.

"No reasonable person can assert today that Hong Kong maintains a high degree of autonomy from China, given facts on the ground," he said.