OPINION
Prime Minister Chris Hipkins showed he knows where New Zealand’s bread is buttered in his first meeting with Chinese President Xi Jinping on Tuesday evening.
The pair had plenty to discuss including human rights concerns in Xinjian, foreign interference and the militarisation of the Pacific.
These things could have been high on the agenda for New Zealand: the situation in Xinjiang was condemned by our Parliament in 2021 in a motion that received the support of all parties, including Hipkins’ Labour, and our Defence Force reckons the establishment of a military base in the Pacific by a country like China is high on the list of things that would pose a serious risk to New Zealand’s security.
But these concerns appear not to have been front of mind during Hipkins’ 40-minute meeting with Xi at the Great Hall of the People in Beijing.
He re-stated New Zealand’s position on the militarisation of the Pacific (but would not say what the Chinese side thought about it), the rest, however, seems scarcely to have been mentioned.
Human rights, Hipkins conceded, “wasn’t discussed in great depth”.
“I referenced New Zealand’s position on it and it ... it wasn’t discussed in great depth,” he said.
“It was a 40-minute meeting.”
Asked how many of those 40 minutes were devoted to raising issues on which China and New Zealand disagree - issues that might benefit from a bit of leader-to-leader discussion, Hipkins was curt: “I didn’t have a stopwatch.”
The contentious things that were mentioned seem to have come mainly from the Chinese side. Although Hipkins’ comments on what was raised were fairly opaque, he hinted that China might have raised concerns that New Zealand was drifting too far into the orbit of the United States, and they potentially raised Hipkins’ decision not to label Xi a dictator, like US President Joe Biden had done.
What did merit a mention was the economy.
“Certainly the economic relationship between New Zealand and China was by far the biggest topic that we discussed,” Hipkins said.
The choice of conversation topic is a bit spineless, but you can hardly blame Hipkins.
New Zealand is in an incredibly tight position trade-wise.
In the year to March, New Zealand posted a $33 billion trade deficit, which is the difference between what we buy and sell abroad. At 8.5 per cent of GDP, it’s a near-record deficit.
We are importing too much and exporting too little.
China, by far our largest trading partner, is a huge part of this story.
We exported $20b worth of goods and services to the country in 2022. We can export even more in the coming years if international education and tourism return to pre-pandemic levels.
Boosting those exports will be part of the story as we close the current account deficit (the other side, more painfully, will be a recession or other kind of downturn getting us to cool our jets on the imports side of things).
Conversely, if China decides it doesn’t like where New Zealand was heading politically, it could send a signal to importers to look elsewhere.
It’s done this to the likes of Norway, Lithuania and even to a limited extent Australia.
This sort of weaponised trade policy is called economic coercion, and it’s something New Zealand is quite concerned about. It signed on to an international declaration against the practice in Paris earlier this year (much to the ire of China, who thought it was directed at them), and papers released under the Official Information Act show the government is working on a strategy to mitigate the effects of economically coercive activity.
New Zealand is especially vulnerable because trade with China is so crucial. Exports to the other Five Eyes countries (Australia, the US, the UK, and Canada), who take perhaps the most hawkish stance on China, totalled just $26b in 2022, only slightly more than the $20b sent to China.
The volume and value of those exports shows just how crucial the relationship is to New Zealand, and just how vulnerable it makes us.
Ahead of the meeting with Xi, Chinese state media, including the fiery tabloid The Global Times published pieces praising New Zealand as a model Western county, not being drawn into the excessively anti-China rhetoric of the United States and Australia.
(There’s a kernel of truth to this. The US and Australia have, from time to time, been excessively disputatious - a policy that benefits no one but domestic politicians wanting to score a few easy points in an election year).
The paper framed New Zealand’s position as a choice between “anti-China” and trade.
Hipkins clearly chose the latter.
President Xi’s remarks suggest he welcomed the choice.
Xi was cool and curt with Hipkins’ predecessor Jacinda Ardern. Her only trip to China was cut short by the March 15, 2019 mosque shooting tragedy, meaning she never got to spend much time here leading trade delegations like her predecessors in the National Government.
Ardern’s only visit to China came on the back of the GCSB’s decision to effectively block Chinese company Huawei’s participation in the 5G rollout.
Then, Xi said “our two sides must trust each other”.
It appears now we do, with Hipkins (after much arm-twisting and caveating), agreeing China is a friend and partner of New Zealand.
Xi’s opening remarks ahead of this week’s meeting, suggest he thinks New Zealand could be a model to other countries in their dealings with China.
“The international community, especially countries in our region have been following your visit very closely.
“We should work together to kick start a new 50 years of our bilateral relations and promote steady and sustained progress in our comprehensive strategic partnership,” Xi said.
Thomas Coughlan is deputy political editor of the New Zealand Herald, which he joined in 2021. He previously worked for Stuff and Newsroom in their Press Gallery offices in Wellington. He started in the Press Gallery in 2018.
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