PM Christopher Luxon downplays China’s role in pause of Cook Islands funding

Prime Minister Christopher Luxon is downplaying China’s role in New Zealand’s decision to pause funding for the Cook Islands over a controversial deal with China.

It comes as Foreign Minister Winston Peters dismisses the potential for New Zealand’s funding pause with the Cook Islands will damage Luxon’s current visit to China.

Peters today confirmed almost $20 million of funding for the island nation in free association with New Zealand will not resume until the Cook Islands Government “takes concrete steps to repair the relationship and restore trust”.

It has prompted strong criticism from Te Pāti Māori, which is accusing the Government of using development funding as a “weapon” against a country exercising its sovereignty.

In February, Cook Islands Prime Minister Mark Brown travelled to China before signing the Action Plan for Comprehensive Strategic Partnership (CSP) 2025-2030, which concerned economic, infrastructure and maritime cooperation, and seabed mineral development.

The deal has prompted international concern over China’s growing presence and influence in the Pacific region.

The decision to pause funding was made on June 4 but wasn’t made public as New Zealand waited for a response from Brown.

However, as reported in the Cook Islands News today, the matter was included in a report tabled in the Cook Islands Parliament this week, forcing Peters to address it.

Cook Islands Prime Minister Mark Brown, left, and Foreign Affairs Minister and Deputy Prime Minister Winston Peters in Rarotonga. 8 February 2024 Photo: RNZ Pacific / Eleisha Foon

Luxon, who arrived in China this week, will meet with President Xi Jinping in the coming days as well as other senior leaders.

Speaking to reporters in China, Luxon downplayed China’s role in the issue and maintained it was a matter for New Zealand and the Cook Islands to discuss.

He wouldn’t be drawn on whether the topic would feature in his meeting with President Xi Jinping.

Despite the unfortunate timing for the Government, Peters dismissed any suggestion Luxon’s engagements would be damaged by the revelation.

Peters argued while he hadn’t informed China of the funding decision, he had already briefed his counterpart Foreign Minister Wang Yi about New Zealand’s relationship with the Cook Islands and its ramifications.

New Zealand, which provided citizenship and other support to the Cook Islands population through its free association relationship, was caught unawares by the February deal, with Peters critical over the lack of communication.

Part of that relationship, New Zealand argued, placed a responsibility on the Cook Islands to inform officials of any such arrangements that could impact New Zealand’s national interests.

After the deal became public, New Zealand soon initiated an assessment of its development programme in the Cook Islands, claiming it was designed to “ensure it wasn’t undermined by the increased cooperation the Cook Islands Government is planning with China“.

Peters’ statement today noted New Zealand had provided almost $200 million to the Cook Islands through its development programme over the past three years.

“The agreements signed by the Cook Islands and China and the lack of consultation with New Zealand about them, illustrate a gap in understanding between the Cook Islands and New Zealand governments about what our special relationship of free association requires,” he said.

“New Zealand hopes that steps will be taken swiftly to address New Zealand’s concerns so that this support can be resumed as soon as possible.”

Speaking to reporters, Peters said the decision to stop funding had been “made slowly” and only after New Zealand’s questions about the China deal were “not getting satisfactory answers”.

Foreign Minister Winston Peters doesn't believe the matter will impact Luxon's current visit to China. Photo / Mark Mitchell

He said senior foreign affairs officials were currently determining what New Zealand wanted to see from the Cook Islands to resume the funding.

The amount paused totalled $18.2m for the current financial year, intended to provide “financial assistance directly to the Cook Islands budget”, according to Peters.

He rubbished any potential suggestion from commentators deeming the pause was a geopolitical move in disguise.

“The cloud-shouters will make all sorts of remarks but I can guarantee you one thing, they’ll be totally uninformed and not in the loop about what’s going on.”

Te Pāti Māori co-leader Debbie Ngarewa-Packer said in a statement claimed the Government was using its aid relationship as a “tool of political obedience” and demanded the funding be resumed.

“Our relationship with the Cook Islands is not one of dominance, it’s one of shared ancestry, migration, and struggle.

“What this government is doing violates that sacred connection.”

A statement from the Cook Islands Ministry of Foreign Affairs this afternoon said there had been a “breakdown and difference in the interpretation” of its consultation requirements with New Zealand.

It stressed the China deal contained “no security or defence arrangements”.

“The Cook Islands has consistently stressed that New Zealand remains our closest partner for security and defence and that position remains unchanged.”

The statement said the Cook Islands was committed to restoring the relationship between the two nations and as such, would be engaging with New Zealand officials through the “formal dialogue mechanism that was established earlier this year after concern about the China deal was expressed.

Adam Pearse is the Deputy Political Editor and part of the NZ Herald’s Press Gallery team based at Parliament in Wellington. He has worked for NZME since 2018, reporting for the Northern Advocate in Whangārei and the Herald in Auckland.