International relations commentators have taken to borrowing a metaphor from physical chemistry: the world is going through a “phase transition”. Just as the state of a glass of water can alter radically by freezing or boiling it, the international system is cracking and hissing as it shifts from a unipolar world governed by US military power and liberal internationalism towards a multipolar model.
Norms are becoming dictated by regional hegemons, of whom the US and China are first among uneasy and rivalrous equals. Donald Trump is an accelerant of this process but the significant markers were Russia’s full-scale invasion of Ukraine in February 2022, and the rapid scaling up of China’s navy between 2014 and 2024, featuring the deployment of advanced aircraft carriers that established China as a peer naval competitor to the US in the Western Pacific.
The war between Israel and Iran is the latest manifestation of the phase transition. Since it was attacked on October 7, 2023, Israel has defeated Hamas and Hezbollah, Iran’s proxy forces in Gaza and Lebanon, and the Iranian-backed Assad regime in Syria has collapsed. And Israel – like Russia – has demonstrated its willingness to inflict mass casualties on civilian populations. With its surprise attack and decapitation of Iran’s military leadership – allegedly accomplished by building a drone factory near Tehran and co-ordinating the attacks via artificial intelligence – it is attempting to establish itself as the Middle East’s regional superpower.
It is difficult to see how Tel Aviv can translate its military triumphs into diplomatic and economic influence, or lasting security, or even whether it can sustain a conflict against an oil-rich adversary with nine times its population.
How does the phase transition affect New Zealand? A week before Christopher Luxon travelled to Shanghai and Beijing to genuflect before China’s leaders – our own region’s undoubted hegemon – and plead with them to send us their tourists and tertiary students, the Trump administration announced a review of its Aukus Pillar 1 arrangement with Australia.
Under Aukus, the US would have supplied Australia’s navy with nuclear submarines to help contain China’s expansion into the Pacific. The deal was rational in the old world, not so much in the new, and the review has sent Australia’s defence establishment into a panic.
For its entire history, Canberra has enjoyed the support of Britain followed by the United States. Australia has long flattered itself that it is America’s deputy in the region. Now it finds itself contemplating a cool indifference from Washington and a complicated and dangerous security environment. China’s military exercises in the Tasman Sea earlier this year have been described by Chinese state media as a normalisation of the deployment of its forces into the South Pacific.
As our only defence ally, Australia’s bewilderment is also ours – although our own scratchy relationship with the US in recent decades has conditioned us to a certain diplomatic independence that is novel to Australia.
Small fish, big pond
After his visit to Beijing, Christopher Luxon flies to Europe for the Nato summit in The Hague. We are partners in Nato’s “Indo-Pacific Four”, alongside South Korea, Japan and Australia. In terms of GDP rankings Japan has the second-largest economy in the region, Australia the fourth, South Korea the fifth – and New Zealand is 16th, likely to be overtaken by Sri Lanka in the next few years.
Nato Secretary General Mark Rutte has indicated that its members should raise their defence spending to 5% of GDP by 2032. We’re already struggling to achieve 2%, and even if we reached it, with heroic spending cuts to welfare and health, our economy is now so diminutive we could hardly make a difference to regional security even if we could keep our own navy afloat.
Finding friends
A multipolar world doesn’t have to exist in a state of perpetual warfare. Historians point to 19th-century Europe, a period of sustained peace in which the continent’s great powers maintained a careful balancing act, respecting each other’s relative spheres of influence. The key to survival as a small or mid-level power was to play the great powers off against one another, forming a network of multilateral relationships. New Zealand’s foreign policy is being dragged in this direction, almost against the best intentions of the coalition government.
An irony of Winston Peters’ lengthy diplomatic career is that one of his most cherished ambitions – rebuilding our security and defence relationship with the US after the end of Anzus in the 1980s – finally came within his grasp when he formed a government with a prime minister as ardently pro-American as himself, only to have the world in which that relationship made sense melt into air.
Both Peters and Luxon have focused on growing our relationship with India, and in the past 18 months Peters has made four visits to Indonesia – our region’s other rapidly growing economic and military power. The skeleton for a post-US security and defence arrangement is already in place: cautious deference towards Beijing balanced by closer relationships with our Nato partners and the other regional powers.
The most likely flashpoints in the Pacific are a crisis on the Korean peninsula and a naval blockade of Taiwan, in which China offers to allow shipping through if Taiwan’s government opens unification talks. The latter is the diplomatic nightmare for New Zealand. Would we stand up for free movement of international trade and condemn Chinese aggression, putting our most valuable trade relationship at risk? Would we actually deploy force to the region?
Australia has indicated that it would support a US-led coalition to defend Taiwan, and we would follow its lead – but no one is sure what the response should be in the absence of US leadership. We are still in the early stages of the phase transition to a multipolar world, and our position in that world is still unclear. All we can see so far is that it’s a more dangerous and uncertain era than the one we’re leaving behind.
