New Zealand appears to be trying to put aside its differences with China to promote economic cooperation that is a "win-win" for both sides.
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| New Zealand Prime Minister Chris Hipkins meets with Chinese President Xi Jinping during his six-day visit to Beijing. (Source: AP) |
The disagreement seemed to be resolved.
New Zealand Prime Minister Chris Hipkins paid a six-day official visit to China (June 25-30).
In the context of Western countries' recent tendency to unite to "de-risk" China, the fact that the head of an important country in the South Pacific led a delegation to visit China once again sent a signal that in the US-led alliance system, there are still some countries that value economic interests with Beijing and want to strengthen economic and trade relations with China to prevent risks of economic fog.
The New Zealand prime minister's visit to China also means that China's expansion of its security influence in the South Pacific last year, which had put countries in the region on high alert, can be put aside.
After US Secretary of State Antony Blinken's visit to China, US President Joe Biden immediately made offensive remarks against China, causing US-China relations that had just shown signs of stability to become tense again.
Having called China a “valuable cooperative partner,” Prime Minister Chris Hipkins said on June 22 that he disagreed with President Joe Biden’s views on China, clearly intending to avoid unnecessary diplomatic turmoil and avoid losing focus on the goal of promoting trade during his visit to China this time.
The outlook for New Zealand's inflation-hit economy is clouded by a fog. Economists are predicting a second recession later this year as the Reserve Bank raises interest rates to fight inflation, causing mortgage rates to rise sharply, people to tighten their belts, and consumer spending to weaken.
Faced with economic stagnation, the New Zealand government is once again turning its attention to China.
After China and New Zealand signed a free trade agreement in 2008, China replaced Australia as New Zealand's largest trading partner by the end of 2013. Of New Zealand's annual exports, about 30% are sent to China, worth about NZD 21 billion. Chinese demand is very important to the New Zealand economy.
Compared to Western countries, New Zealand's attitude towards China has always tended to be moderate. However, China's trade sanctions against neighboring Australia and the signing of a police cooperation agreement with the South Pacific island nation of Solomon last year have made New Zealand wary and have taken a tougher stance towards China recently, especially in June 2022, when the country began attending the annual summit of the North Atlantic Treaty Organization (NATO).
In addition, New Zealand is also looking to reduce its trade dependence on China, with goods exports to China falling 2 percentage points year-on-year in April to 29%, marking the first decline since 2015.
Is there a "lost step" with the West?
However, faced with a bleak economic outlook, the Chris Hipkins government now appears unenthusiastic about “de-risking”, wanting to diversify trade with China, exporting more goods and services.
On June 27, during a meeting with Prime Minister Chris Hipkins at the Great Hall of the People in Beijing, Chinese President Xi Jinping said that China and New Zealand need to promote liberalization and facilitation of trade and investment, provide a positive business environment for businesses on both sides, and also need to strengthen cooperation in areas such as education, culture, tourism, etc.
Meanwhile, Prime Minister Chris Hipkins described the two countries as having “one of the most important and extensive relationships” in the world, and stressed that the focus of this visit was to support businesses from both countries to rebuild and deepen the relationship, in line with China's goal of attracting foreign investment.
The Chinese president also called on the two countries to continue to see each other as partners rather than rivals, as opportunities rather than threats, maintain communication and jointly help Pacific island nations develop, and make efforts to strengthen dialogue and reduce New Zealand's concerns about China's security activities in the South Pacific.
On June 28, during a meeting with Chris Hipkins at the Great Hall of the People, Chinese Premier Li Qiang emphasized that China's door will open wider and wider, ready to share new opportunities from China's development with New Zealand, exploiting the potential of the digital economy, green economy, creative industry, etc., creating new momentum for cooperation in emerging fields.
After the talks, Chinese Premier Li Qiang and Chris Hipkins witnessed the signing of many bilateral cooperation agreements such as science and technology, education, and agriculture.
On the same day, China and New Zealand issued a joint statement on comprehensive strategic partnership, agreeing to strengthen high-level exchanges, deepen cooperation, enhance understanding, and control differences.
New Zealand welcomes China's accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), as well as participation in the ongoing in-depth discussions of the Digital Economy Partnership Agreement (DEPA) working group.
Now, New Zealand and China have a common interest in fixing their sagging economies, and China also wants New Zealand to not lean more towards the Western military bloc, so there is an incentive to put differences aside.
However, with the ever-increasing geopolitical tensions in the Indo-Pacific region and the growing calls in New Zealand to reduce its dependence on China, it remains to be seen whether the trend of cooperation based on the two sides' commercial needs can continue to overcome obstacles.
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