New Zealand will support a 300ha land reclamation project for housing in the tiny Kiribati island state as it battles to counter the effects of climate change, Foreign Minister and Acting Prime Minister Winston Peters has announced.

The Ministry of Foreign Affairs and Trade would establish a new fund, the Strategic International Development Fund, Peters said in a speech tonight.

He indicated it would be earmarked for projects in the Pacific that had a life of at least 50 years and involved partner projects with friends such as Europe, Japan or Australia.

The speech, to the Otago University Foreign Policy School in Dunedin, is only his second major speech since becoming Foreign Minister in October last year, after an earlier stint from 2005 – 2008.


The first speech he gave - in Sydney in February - outlined what he called a "Pacific reset" which put the Pacific at the forefront of New Zealand's foreign policy and was bolstered by a $714 million increase in overseas development assistance in the May Budget.

The Dunedin speech ventures into broader relationships and rhetorically questions what it means to have an independent foreign policy in 2018 and also notes that "great power competition in back."

He made an apparent reference to Donald Trump in using the word "disruptive" - a common description of the US President.

"During this current disruptive phase of history, when the global system is under severe strain, the conundrum of being a small state actor becomes greater," Peters said.

"We face greater foreign policy challenges. It is both a time for being deliberate and a time to adapt.

"It also reinforces the need for New Zealand's independent voice to be both subtle and strong."

During this current disruptive phase of history, when the global system is under severe strain, the conundrum of being a small state actor becomes greater.

He said that in 1987, during the height of the Anzus dispute, asserting New Zealand's anti-nuclear policy could be viewed as establishing New Zealand's self-respect as a small state actor with strong values managing a dispute with an ally over the ultimate existential threat of nuclear weapons.

"In 2018, the international order is different, the relationships more complex, and a clear-sighted assessment of the challenges being faced is required."


He indicated that New Zealand was at turning point and said the Government would be receptive to bold ideas on what constitutes an independent foreign policy.

"The Government's challenge to become more self-reliant is also yours," he said.

"Small thinking leads to small outcomes. No more. To regain a truly independent voice requires the support of a sophisticated media and academia.

"New Zealand is at an inflexion point in its history so we encourage our best and brightest to challenge the orthodoxy of small state foreign policy analysis.

"It is not a time for intellectual timidity. It is a time for original thinking as we develop foreign policy prescriptions from adaptation rather than deliberate creation.

"Creative syntheses and challenging old verities is needed more than ever so be bold and take risks in your work. If you do, you will find in this Government a receptive ear to your ideas."


With reference to New Zealand's pursuit for a rules-based regional order, he made criticisms of China's aggressive behavior in the South China Seas, without naming it.

"We see some troubling developments," he said. "In the South China Sea, claimants in the various territorial disputes have acted in ways that challenge international law and norms.

"Artificial island building in contested waters, construction, and militarisation risk escalating tensions."

But Peters also included some guarded criticism of the United States, in an apparent reference to its need to uphold a rules-based order in international trade.

"Our emphasis on international law, inclusivity, economic integration, trade, and respect for sovereignty makes us a constructive regional partner for most states," Peters said.

It went without saying that Australia was New Zealand's closest and indispensable partner in that respect, he said.


"Overall history and shared values have shaped our most enduring partnerships.

"It is also true a rules-based order will not function properly without buy-in from the world's largest countries – the United States and China."

He made his first formal statement about New Zealand's intention to stick with the term "Asia-Pacific" to describe New Zealand's region – rather than adopting the "Indo-Pacific" term that the United States, Australia and Japan have begun using.

"Asia-Pacific" resonated with New Zealanders because of its geography he said.

He also asserted New Zealand partnership with Asean (10 Southeast Asian countries).

"New Zealand supports Asean centrality."