Prime Minister Christopher Luxon is set to meet with key world leaders in Asia this week. Photo / Mark Mitchell
Prime Minister Christopher Luxon is set to meet with key world leaders in Asia this week. Photo / Mark Mitchell
Christopher Luxon is flying to Laos for the East Asia Summit today
He’s expected to discuss economic ties and security issues, like in the South China Sea and Taiwan Strait
Experts say the value of facetime with other world leaders shouldn’t be underestimated
Prime Minister Christopher Luxon’s flying to Laos today for a meeting of world leaders, a trip being described as a “hugely valuable opportunity for New Zealand” in terms of bolstering our economic and security relationships.
It will see Luxon gather with senior representatives of the United States, China,India and more heavy hitters amid a turbulent time both in the Southeast Asia region and further abroad. The Herald has spoken with several experts who said the value of this facetime should not be underestimated.
One trade specialist said New Zealand has a “vested interest in ensuring international law is respected” as any conflict in the region could be “catastrophic” for our trading networks – and therefore our heavily trade-dependent economy.
New Zealand is also preparing to mark 50 years of its partnership with the Association of Southeast Asian Nations (Asean) in 2025 with the hope of securing a major upgrade to relations. As a bloc, Asean is New Zealand’s fourth-largest trading partner, with room to grow further.
India will be there, a nation New Zealand is currently trying to ramp up economic ties with. Luxon has spoken with Prime Minister Narendra Modi on the phone but is yet to sit down for official talks with him. While getting a Free Trade Agreement (FTA) with India is often discussed as the ultimate goal for New Zealand, commentators suggest business partnerships and flight connectivity should be on the agenda.
The Prime Minister is travelling to Laos officially for the East Asia Summit (EAS), the annual forum convened by the Asean with a focus on strategic, political and economic issues. It’s not only attended by regional leaders, but many of the world’s superpowers.
“The EAS is an important opportunity to discuss strategic issues, which continue to be on an increasingly challenging trajectory across the Indo-Pacific,” Luxon said ahead of the trip.
“With so many counterparts in Vientiane, I look forward to meeting formally and informally with leaders from across the region to advance New Zealand’s interests.”
Prime Minister Christopher Luxon is travelling to Laos. Photo / Mark Mitchell
Making friends with powerful leaders
Luxon’s said to have secured a “substantial number” of bilateral meetings with counterparts during his two-day mission, the latest in a string of overseas trips the Prime Minister has made this year.
David Capie, a professor of international relations at Victoria University and on the board of the Asia New Zealand Foundation, told the Herald this was a “hugely valuable opportunity”.
“If you think about all the countries that want to get to the door of the White House, or the door of the Premier of China, or the door of the Prime Minister of India, those are hard opportunities to make happen,” he said.
“Those are opportunities you get to do within the context of an East Asia Summit... you get a lot of opportunities to interact with world leaders you might not necessarily get as a smallish country... you can do a lot of business.”
Among the leaders Luxon will could want to speak with is Modi and Japan’s new Prime Minister Ishiba Shigeru. China is expected to be represented by Premier Li Qiang and the United States will have Secretary of State Antony Blinken in attendance. Russia’s Foreign Minister Sergey Lavrov will also be there.
Trade expert Charles Finny said New Zealand wasn’t normally “front of mind” for these other world leaders, but “these meetings force us to be front of mind”. He rejected the notion that these events could just be talkfests.
“If people think you’re just going over to sleep through a meeting and go to a cocktail party and a dinner, it’s not like that at all. You’re working from breakfast through to probably after dinner. There will be bilaterals, plurilaterals.”
A guard of honour welcomes Luxon to the Istana, Singapore. Photo / Craig McCulloch, RNZ
Luxon has already visited several Southeast Asia nations this year, like Singapore, Thailand and the Philippines. He also flew to Melbourne in March to meet with Asean leaders on the sideline of a special summit there.
It’s part of a co-ordinated effort by the Government to step up its approach to the region.
A briefing from the Ministry of Foreign Affairs and Trade (MFAT) in December said the region wants a “stronger New Zealand presence” and “showing up in capitals matters”.
“We recommend taking advantage of the intensity and energy of the new Government to signal a step change.”
The Lowy Institute, an Australian think tank, last month put out a report which said New Zealand had dropped in what it considered was “diplomatic influence” and the nation was being “left behind by the quickening pace of Asia’s defence diplomacy”.
Finny called that “rubbish”.
“I think that maybe there was an argument that you might have been able to make under the first year and a bit after Covid, but I don’t think I have seen a more hardworking Foreign Minister or Trade Minister, or a more travelled Prime Minister in such a short space of time.”
Capie agreed the Government couldn’t be criticised “for not being on the road enough” and Foreign Affairs Minister Winston Peters had been “travelling like a demon”.
“The Government likes to talk about a foreign policy step up in Southeast Asia, and I think all of the signals that they’ve sent so far about wanting to be more active, wanting to do more in the region, have been really well-received.
“I think the real question is what we will follow that up with? Where will the resource be to follow-up?”.
Foreign Affairs Minister Winston Peters has been travelling like a "demon", says David Capie. Photo / Mark Mitchell
Flashpoints
Building those relationships is seen as essential to then addressing the growing list of potential flashpoints in the region.
“The way we’re engaging and thinking about Southeast Asia is that it’s really vital for our strategic interests and it’s a region where there’s growing number of security challenges and where New Zealand is looking to do more,” said Capie.
Security issues are likely to top the agenda for the EAS, with experts pointing to tensions in the disputed areas of the South China Sea between China and the Philippines. While China has claimed sovereignty over the waters, the Philippines in 2016 won a dispute in the Hague finding China had no legal basis for such a claim.
“For New Zealand, it’s also really important as a place where we want to make clear how much we value respect international law and in particular, the UN law of the sea,” said Capie.
Finny said: “It’s an important meeting, and even if we don’t do any immediate business, it’s all part of a process that leads to better access... being able to solve problems when they arise more quickly”.
He said a lot of New Zealand’s trade goes through or close to those areas of concern.
“It would be potentially catastrophic and we could lose the Japan, Korea markets, the China market, Taiwan, Hong Kong, the Philippines, and maybe Vietnam, if there was any conflict. We just can’t allow it to happen.”
The Herald requested MFAT provide any advice it had given ministers this year about the risks or potential effects of conflict in the region on trade for New Zealand.
One document identified was fully withheld to “avoid prejudicing the security or defence of New Zealand or international relations”. There was a large number of other briefings referring to the South China Sea and Taiwan Strait and mentioning trade, but they could not be made available without substantial collation or research.
“However, we can say that the consistent advice to ministers is, as a trade-dependent nation, with nearly half of our trade passing through the South China Sea, that continued unimpeded access to shipping and air routes is vital.”
Capie said it also wouldn’t be surprising if the current conflict in the Middle East was raised at the EAS. He said the people of some Southeast Asian nations like Malaysia, Indonesia and Brunei - these have a big Muslim population - would be looking at the destruction “with aghast”.
Securing a meeting with Narendra Modi would be major.
An eye on India
Turbo-charging New Zealand’s economic relationships with Southeast Asia countries could prove helpful as the Government eyes doubling the value of exports over the next decade.
The Asean bloc is already significant for our traders. In the year to June 2024, exports were worth $9.21 billion or 9.4% of New Zealand’s overall export value over this period. There’s a big deficit though when considering imports were worth $16.68 billion or 15.8% of all imports.
With next year marking 50 years of dialogue relations between Asean and New Zealand, MFAT officials and ministers have told the bloc that New Zealand wants to upgrade our relationship to what is called a “Comprehensive Strategic Partnership”.
Luxon said elevating that relationship would be a “particular priority” while he is in Laos.
Individually, some nations that will be present at the forum also represent rapidly growing markets, Finny said. He mentioned Thailand, Vietnam, the Philippines - “a huge source of talent for the New Zealand economy” - and Indonesia among others.
Rahul Sen, an economic lecturer at Auckland University of Technology (AUT), said New Zealand is connected to the region through a network of trade agreements, like the Asean-Australia-New Zealand FTA, the Regional Comprehensive Economic Partnership (RCEP) and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
Again, the forum providing a chance for facetime with leaders of these nations assists could only be beneficial, said Sen.
“These trade agreements are very strategic in nature. There is a very big economic potential that comes with it, but it is very much strategic in nature.
“It is really important for the leaders to have that facetime to actually share their opportunity that they will get or any concerns that they might have while entering into such agreements. Trade negotiations are always sort of based on as much face to face and that’s where you get the biggest value out of it.”
Trade Minister Todd McClay has been overseas building relationships for New Zealand. Photo / Mark Mitchell
One member of the EAS New Zealand has a keen interest in is India. The fast-growing economy has been courted by ministers in recent months, especially with Luxon promising during last year’s election campaign that it would secure an FTA this term.
That’s been described as highly ambitious with India’s protectionist approach to agriculture. There are no formal negotiations currently ongoing, with the last round taking place in February 2015 - nearly 10 years ago.
It was thought Luxon may head to India this year, but he’s acknowledged that had been difficult given the number of overseas trips already scheduled over the coming months. It’s also a busy period internationally, with several summits - like Apec in November - being held.
Securing a meeting with Modi would be a major deal.
“We are wanting to demonstrate our value to India,” Finny said. “That value is as a political partner, as a security partner, as a trade partner, as a place where Indians can send people to be educated, and hopefully as a tourism partner.”
Sen said an FTA shouldn’t be New Zealand’s only focus. India’s growth strategy, he said, put an emphasis on the digital economy as well as agriculture and food processing - areas New Zealand could contribute to.
“We should actually look at what we call as a comprehensive economic partnership, which means we are looking at an investment-driven long-term trade agreement where we are contributing to certain sectors in India through tech partnerships, through business partnerships.
“It’s giving us a platform for New Zealand businesses to actually set up shop in India and export from there.”
He said the phrase “free trade agreement” has a “negative connotation” in India, so changing the approach to a “comprehensive economic partnership” “signals that we are really wanting to partner with you for the long term”.
Both Sen and Finny mentioned the lack of direct flights between the nations.
Sen said: “This is a very big missing link because if we want that frequent face-to-face, if we want frequent business interactions, if we are serious about engaging with India with the long term, we have to have a direct flight connectivity which reduces the travel time, which reduces the trade costs.”
Jamie Ensor is a political reporter in the NZ Herald Press Gallery team based at Parliament. He was previously a TV reporter and digital producer in the Newshub Press Gallery office.
