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With friends like these

Post the Obama presidency, international relations have become increasingly fraught. Starting with the trade war with China, initiated under President Trump, US-Sino relations have become tense. China’s assertiveness in various arenas, e.g. the South China Sea, have contributed to the tension.

The growing rivalry between the two superpowers appears to be making it harder to adopt a neutral stance, and nations may increasingly be compelled to pick sides. The recent AUKUS pact adds to the complexity as New Zealand’s (NZ) most significant political ally, Australia, appears to have aligned itself decisively alongside the US.

Given the growing rivalry and complexity, how could a small nation like NZ navigate international diplomacy?

Doing what’s right?

Be careful regarding moral judgements in relation to diplomacy. Great power rivalry in the 21st century is not like WWII, where one side was “good” and the other “evil”. To illustrate, if NZ were to choose between the US and China, how would we judge US foreign policy disasters leading to the deaths of civilians in Iraq and Afghanistan, vs. the abuse and forced labour of Uighurs in China? Trying to balance the sins of Great Powers risks a futile “whataboutism” involving impossible value judgements.

Not to say there is no place for value judgements, nations need to know what they stand for. NZ’s commitment to being nuclear-free is perhaps the best example of this. It would have been far easier economically and politically to not adopt a nuclear-free stance, but ultimately NZers commitment to nuclear disarmament and a nuclear-free Pacific won out.

Political expediency

Political and cultural considerations are also relevant - which nations have we historically been aligned with, and can rely on (for the most part) to stand up for our interests in the global community of 195 countries? NZ’s political arrangements, as encapsulated in agreements like the Five Eyes, APEC and the recently signed Comprehensive and Progressive Agreement for Trans-Pacific Partnership, broadly reflect our commitment to democracy, multilateralism, free trade and engagement with the Pacific. A nation that did not share these values/political objectives would perhaps be less worthwhile or more difficult to engage with.

The commitments to multilateralism and free trade are worth discussing. Global powers tend to be less reliant upon other nations and accordingly simply have less need, or interest to cooperate. For example, “America First'' under President Trump led to the US withdrawing from the TPP, scuppering a collaborative international agreement a long time in the making and led in part by NZ. This example also shows how a small country could be left high and dry if domestic political considerations within a global power change.

Economic self-interest

Although we discuss it here separately, we recognise that economic and political interests are not mutually exclusive.

Economics is often the trump card in calibrating international relations. Economic self-interest tends to reflect a country's geographic location. If we look at NZ’s top 10 export partners, nine are located on the Pacific rim, with only one (the UK) outside of NZ’s neighbourhood.

Pissing off a major trade partner is a recipe for job losses and GDP decline and the smaller you are, the higher the stakes. Take the US-Sino trade war, if the US economy were the size of NZ’s it's possible, even probable, that the war would never have been initiated in the first place. As a function of globalisation, the complexity of many products (especially technology), and simply sheer size, NZ can’t produce many of the goods imported from a country like China. Accordingly, attempting to cut off China economically would have much more impact on NZ than China... Similarly, getting ourselves into a position where China decided to curtail trade with NZ for political reasons, could be far more damaging to us than a country like the United States, or even Australia. For these reasons NZ needs to be a lot more careful than most of our larger traditional allies when it comes to stepping on other countries’ toes.

The 'national interest'

So what is in NZ’s national interest?

The logical answer is to keep doing what we’re doing, walk the middle ground whenever and wherever possible. Avoid frustrating both superpowers so as to maintain cordial, friendly, relations, while accepting that this means we will not be “best mates” with either. NZ should also avoid getting sucked into a false dichotomy (e.g. side with the US or with China). In practice, international relations are rarely an either-or decision. The Sino-US rivalry may make it more difficult to walk a middle road but plenty of options with regard to the relationships NZ can pursue.

Our history offers a helpful warning to NZ in terms of aligning itself too much, politically and/or economically, with a single country. When the UK joined the European Economic Community (EEC) in 1973 it didn’t matter so much that NZ had fought two wars on foreign soil to defend the UK. The country’s trade was devastated as NZ dairy and meat products were replaced with those from the UK’s new European partners. As a small nation, it is possible that there is more scope for NZ to be taken advantage of, or bullied, from aligning itself too closely, than from maintaining balance in its relationships.

Nonetheless, we need to be clear about our own red lines. Unprovoked military aggression by China (or any country for that matter), in the Asia-Pacific, may justify a change in NZ’s stance. At the same time, in the absence of a red line being crossed, NZ should be careful about joining the US or its other allies in attempting to constrain China politically or economically (e.g. AUKUS style treaties). For starters, NZ's involvement wouldn’t move the needle and in any case, the stakes for NZ are far higher.


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