COMMENT:

This week might come to be seen as a turning point in New Zealand's complex trading and political relations with China. Suddenly there is a very strong awareness of the deteriorating relations between the capitals of Wellington and Beijing. And although there is plenty of confusion and contention about the details, it's clear that the Chinese Government has initiated a type of political blowback against New Zealand. This is based on what the Beijing government see as a betrayal by its formerly-close trading partner.

Three factors have been discussed this week as signalling that China has initiated a campaign of retaliation against New Zealand: 1) the sudden announcement that China is postponing the long-planned launch of tourism initiative in Wellington next week, 2) the mysterious turning back of an Air New Zealand flight to Shanghai in the weekend, and 3) the long-running inability of Prime Minister Jacinda Ardern to arrange a diplomatic visit to China.

The story about the postponement of the tourism launch was broken by Barry Soper on the frontpage of the Herald on Tuesday, explaining that: "The 2019 China-New Zealand Year of Tourism was meant to be launched with great fanfare at Wellington's Te Papa museum next week, but that has been postponed by China" – see: China, New Zealand links sink to new low: PM Jacinda Ardern's visit on hold, tourism project postponed.

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In a second piece on Tuesday, Soper points out that the diplomatic explanations for the postponement aren't credible: "the lame excuse from Wellington officials that there was a change of schedule. Given the Year was announced two years ago by the Key Government when the Chinese Premier visited here, Beijing's had plenty of time to schedule it in" – see: NZ feeling the heat of the Chinese dragon.

This article also delves into the long-running difficulties that Ardern is having in getting an official visit agreed to by Beijing. Soper says: "The invitation for Jacinda Ardern to visit Beijing early this year's been put on ice and all her talk at the end of last year about neither side being able to coordinate their diaries was baloney."

In addition, Soper points to the third issue – the "turning back of the new Air New Zealand plane over the weekend, which was half way to Shanghai, because it wasn't registered". These three incidents illustrate, according to Soper that "New Zealand is feeling the heat of the Chinese dragon's breath and if we're not careful it could incinerate us." He reports that "word from the Chinese capital is that retaliation is being worked on."

And Soper points out that it's easy to understand why the Chinese have become upset with New Zealand, after the Government here essentially decided late last year to ban the Chinese company Huawei from being involved in the new 5G telecommunications network.

I covered this at the time in my column, Huawei decision is the price of being in Five Eyes, pointing out that the decision was widely seen as fulfilling a US Government request to help it its geopolitical battle against China and Huawei. I predicted, "There is certainly going to be a cost for the ban… this country's economic and diplomatic ties with the superpower of China will now be strained as a result."

Of course, it wasn't just the Huawei decision that soured relations with China – Wellington has been edging away from a close friendship with Beijing for a few years. This is all explained in a must-read column today by Victoria University of Wellington's strategic studies specialist, Robert Ayson, who goes through the deterioration of the Wellington-Beijing relationship, saying that even under John Key "New Zealand was raising concerns about China's behaviour in the South China Sea" and in return received some messages "suggesting that Wellington should stay quiet if it wanted an FTA upgrade" – see: New Zealand and China: time for clarity in a hall of mirrors.

According to Ayson, New Zealand's criticisms of China have been increasing, especially with Ron Mark as Minister of Defence, and with the Government "calling out" China "for nefarious cyber activities".

The Labour-led Government is still denying, or at least downplaying, the serious pushback that is now coming from Beijing. For the most recent examples of this, see Jo Moir's news report, Winston Peters dismisses claims govt visits to China stalling.

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The best quote in this story is from Shane Jones who declares: "I don't think I'm one of these losery politicians that's apparently not allowed to go to China, in fact I'm very popular with the Chinese – I think they see a kindred industrial spirit." And David Parker is also reported as having visited China and seen no signs of trouble in the relationship.

But there's clearly now a consensus amongst political commentators and journalists that the political blowback from China is real, many of who are complaining that the Prime Minister and Government are either failing to be upfront or else simply being delusional about the relationship.

Veteran political journalist Richard Harman reports that "the foreign affairs community" is certainly asking questions about China's retaliation against New Zealand, and says diplomats and officials even see the incident with the Air New Zealand flight as evidence that the relationship has soured – see his column, Why was the AirNZ plane turned back?

The suggestion is made that China is now cracking down "on technical infringements of its laws" when it comes to New Zealand exporters or the national carrier. In this regard he reports that Victoria University's David Capie "suggested that what the incident showed was that New Zealand no longer had a special relationship with China. In other words, all things being equal previously, China would have found a way to let the plane land."

China is prone to using this type of ambiguous retaliation, according to Newsroom's Sam Sachdeva: "China has a history of operating with plausible deniability when it comes to meting out punishments" – see: NZ-China 'scheduling issues' cause for concern.

Sachdeva reports, "One observer noted that blowback often begins with tourism numbers, moving onto international education before spreading to the wider trade and economic relationship – a script into which the postponement of the Year of Tourism launch sits uneasily."

The problem, according to the New Zealand Herald, is that New Zealand appears to have chosen sides in the growing US-China rivalry – see the editorial: Has our Govt antagonised China? It points out that "it is not hard to see why China would have the impression this country is not the friend it used to be. The new Government's 'reset' of policy towards the Pacific Islands is strongly tinged with support for the US and suspicion of China's interests in the region."

New Zealand observers in Beijing are also commenting on what's going on. The most interesting is businessman David Mahon, who is interviewed by Liam Dann, saying that the decision to ban Huawei was "seen as a Five Eyes stitch up" and "a breach of trust" – see: NZ/China relationship: 'We have a big problem'.

Mahon suggests that New Zealand had been building a much closer relationship with China for the last four decades, with the Chinese having huge respect for this country, but "In the last 12 months or so that has almost reversed. So there is now a very different view, almost an opposite view of New Zealand.

There are real dangers of the China-NZ relationship getting much worse. Geopolitical and security analyst Paul Buchanan says that he's now warning his clients against going to China due to risks to their safety as a result of what's going on at the governmental level. On Newstalk ZB, Buchanan said "if you are a New Zealand resident in China, you need to be cognisant of the fact that there could be a knock on your door and you could be taken away on corruption charges or turpitude charges" – see: Kiwis warned over 'hostage diplomacy' from China.

Slowly but surely, the current government has engineered a major reorientation of foreign policy according to Audrey Young, who labels the Relationship with China a diplomatic mess. She complains that this "was never foreshadowed before the last election".

The shift appears to lie with New Zealand First and Winston Peters: "Peters has been an irritant. A year ago Peters framed his Pacific Reset in terms of a response to counter China's growing influence in the region, and he challenged China's most important foreign policy strategy, the Belt and Road initiative. He ended the year with a speech in Washington, almost a love-letter to America, practically begging them to get more involved in the Pacific to counter China's influence. A National Party Foreign Minister could not have made such a speech without being accused of wanting to rejoin Anzus."

According to Young, the onus is now on the Government, and the Prime Minister, to fix the deterioration. They need to "to take a lot more care in preserving the relationship New Zealand had and to be less cavalier."

Similarly, the Prime Minister needs to sort out her long-promised trip to Beijing, according to economics journalist Hamish Rutherford – see: Until Jacinda Ardern visits China, questions about the relationship will only deepen.

Rutherford discusses the on-again-off-again trip: "Ardern is left trotting out the line that this is a scheduling issue, and the only thing keeping her from an official visit is scheduling clashes. This has been the case for some time; journalists were asked to prepare for a trip in December, however this was abruptly cancelled. The longer the situation goes on, the more it appears that the excuse that the problems are caused by scheduling issues are simply a subtle diplomatic slap. For weeks there have been rumours that officials at the Chinese Embassy have warned the Ministry of Foreign Affairs and Trade that the trip is not happening until other issues are resolved, something Mfat denies."

Herald business editor Fran O'Sullivan is also calling for the Government to quickly fix the problems – see: Chinese relations must get back on track. Her suggestion, however, is that the "postponed" tourism event needs to be sorted out by the Minister of Tourism Kelvin Davis getting "on the first plane up to China to sort out the debacle".

But perhaps it's the Minister of Foreign Affairs that needs to be sorted out. Richard Harman suggests that this might already be happening: "The Prime Minister appeared yesterday to deliver a subtle message to Foreign Minister Winston Peters telling him, she, not him, ran foreign policy. This contrasts with her admission last year that she had not read a speech he gave in Washington directly criticising China and calling for more American involvement in the Pacific" – see: Ardern takes the lead on China.

Could Peters even be shifted on from his portfolio, in order to satisfy the Chinese? It seems unlikely, but that's the hint that security specialist Robert Ayson is making when he says that fixing the NZ-China relations "may also mean a change in the pecking order within the politburo in Wellington."

Ayson's column, cited above, also has plenty of other suggestions for how the mess might be fixed – and these include providing the Chinese government with greater clarity about the Huawei decision, showing that New Zealand is not simply "a willing member of a new Cold War", stop cosying up to the US, and pull back from Winston Peters' anti-China Pacific Reset strategy.

Finally, last month Matthew Hooton wrote an important and prescient column about New Zealand's changing relationship with China and US, and this is well worth reading as background for what is happening now – see: Is Jacinda Ardern on board with the Winston Peters Reset?