New Zealand's Relations with the US and China: A Survey of the NZ Strategic Studies Community

Twitter: @ReubenSteff

Abstract: This article contains research from a written survey conducted in late 2016 of members of the New Zealand strategic studies community. They were asked to assess the state of relations between NZ, the US and China at that time, the expected future state of relations, and give their views on various aspects of the three states bilateral and triangular relations. The findings predict greater turbulence between Beijing and Washington over the coming decade and make recommendations for policymakers in NZ to consider. This article outlines these findings, provides brief commentary and suggests areas where subsequent research could prove fruitful. 

The first part of this article contains the quantitative survey findings, followed by some of the qualitative responses with brief commentary from the authors. The full set of qualitative responses is included at the end of the article in an appendix. We invite readers to consider these to draw their own conclusions and to use them for their own research purposes. The names of respondents to the survey have been kept anonymous. The authors of this article can be reached via email: rsteff@waikato.ac.nz and fjd5@students.waikato.ac.nz.

Introduction             

While in recent decades New Zealand’s (NZ) key security relationships have remain centered on its traditional partners (Australia, the U.S., and U.K.) and have, in some instances (such as NZ-US security relations) deepened over the past decade, China has become one of Wellington’s key trading partners. This raises a potential dilemma for NZ policymakers, as China is a non-traditional partner, does not share many of its values and is engaged in a competition for influence across the Asia-Pacific with the United States. The crux is that China’s growing economic (and military) power offer Beijing immense influence to promote policies that support its interests and that it could leverage against states in the Asia-Pacific, such as NZ, to adopt positions at the expense of American interests. Naturally, the US could also encourage and/or pressure its regional allies to take positions that are at odds with Chinese interests.

To examine the issue of NZ’s ties with the US and China, and potential complications that could arise from the interrelationship between Wellington’s two sets of bilateral relations with either power, the authors of this article conducted a written survey of the NZ strategic studies community in late 2016. Separately, they also penned a journal article that examines and contributes to the existing scholarly literature on this issue and that complements this article.^[1] The survey involved contacting members in academia, the think tank community and former government employees with expertise on NZ foreign policy. In total, 48 candidates were approached, with 18 (40%) choosing to take part in the survey. To ensure their responses were free and frank we stipulated that their identities would remain anonymous. We can say, though, that the grouping includes individuals with policy experience from their time in government, individuals from NZ think tanks and academia, and many of the participants continue to actively contribute to discussions and debates on NZ foreign policy in academia and civil society.

The final survey product contained a set of quantitative questions, some of which also allowed survey participants to add a qualitative response, and a second set of questions that were solely qualitative. The rationale behind the survey was that expert views of the state, and expected future state of relations between NZ and the US and China, and identification of pressing issues, could spur debate, inform policymaking, and allow strategic anticipation and adjustments to take place based upon future expectations.

In retrospect, some of the questions were slightly ambiguous but we also reasoned that, in some instances, respondents should have some leeway to interpret the question as they saw fit. Furthermore, qualitative questions allowed participants to expand and elucidate what lay behind their thinking. In many cases, questions were direct and not ambiguous.

Given it is now 2018, we feel it is worth speculating that had the survey been conducted in the wake of the (largely unexpected) victory of Donald J. Trump in the US election, respondents may have been more skeptical about their assessment of the future state of US-China ties and perhaps US-NZ ties as well than they were when the survey was taken in late 2016 (immediately prior to the US election). However, we do not believe that this renders the findings of the survey redundant as broad trends across the Asia-Pacific are likely to continue to play out irrespective of who sits in the White House. Ultimately, this survey should be viewed a ‘snapshot in time’ and we hope that scholars and policymakers may find some value in it irrespective of when it took place.

The next section outlines the views of the NZ strategic studies community as they relate to NZ’s relations with the US and China.

The Survey’s Findings

Assessing the Shape of Bilateral Relations

The first set of quantitative questions required participants to rate NZ-US, NZ-China and US-China relations along a 1-5 scale, with 1 being ‘very poor’, 3 ‘fair’, and 5 ‘very good’. The findings from the survey are contained in the table below. The rest of the section discusses the findings and draws upon the qualitative responses to highlight some of the notable points raised by the respondents. Readers should bear in mind that the word ‘current’ in the table below refers to late 2016, before Donald J. Trump won the US election.

Table 1: Survey Findings (late 2016)

NZ-China: Good Relations

A majority of survey participants, 68%, felt that NZ had ‘good/very good’ political relations with China, and a large majority of 95% recorded that NZ had ‘good/very good’ economic relations with Beijing. NZ’s current security relationship with China was not judged positively, with 16% rating it ‘poor’, 58% rating it ‘fair’ and 26% ‘good’. More than three quarters of respondents, 79%, believed NZ's overall relationship with China was ‘good’ or ‘very good’. In other words, NZ-China relations were generally viewed positively, with a majority of responses falling into the ‘good’ category across each question.

NZ-US: Good-Very Good Relations

A majority of survey respondents judged NZ-US relations more positively than they did NZ-China relations. 100% of participants rated NZ’s political relations with the US ‘good/very good’, 95% felt NZ-US security relations were ‘good/very good’ and just 5% felt they were ‘fair’. 79% participants judged the economic relationship to be ‘good/very good’, with 21% judging this aspect ‘fair’. Notably, 89% agreed that NZ's overall relationship with the US was ‘good’ or ‘very good’, a figure 10% higher than NZ-China relations.

US-China: Fair Relations

Unsurprisingly, participants did not rate US-China relations nearly as high as they did NZ-US or NZ-China relations. The US-China political relationship leaned towards negative territory, with 37% judging it ‘poor’, 47% ‘fair’, and only 16% rating it ‘good’. No respondents placed it in the ‘very good’ category. The economic relationship received a more positive response, with 53% of respondents rating it ‘fair’ and 47% rating it ‘good’. The security relationship, however, was judged negatively, with 68% of respondents rating it ‘very poor/poor’, with 32% ranking it ‘fair’. No respondent rated it ‘good’ or ‘very good’. A large majority, 84%, judged the overall US-China relationship to be ‘fair’.

Discussion

The findings above are not particularly surprising. For example, considering NZ’s trade with China has grown markedly in recent years, we would expect this to be rated the most positive area of NZ-China ties, and political relations to also receive a high mark. Yet, while the political relationship between Wellington and Beijing is robust, and some security links are being developed, they are clearly not as deep or broad as NZ-US relations. The findings are also consistent with the concern that, owing to its diverging economic and security relationships, and relative position of weakness vis-à-vis the US and China, Wellington could face future policy dilemmas. In particular, the responses we obtained regarding US-China relations, especially in the security sphere, where 68% placed it in the ‘poor/very poor’ category, should be cause for some concern in NZ policymaking circles. 

Respondent predictions

The second set of questions asked respondents to provide an assessment as to whether they believed certain developments would take place in the next 10 years. A scale of 1-5 was used, with 1 being ‘very unlikely’, 3 ‘indeterminate’ and 5 ‘very likely’. Over half of the participants believe it ‘quite likely/very likely’ China will overtake the US as the largest economy in ten years, 26% judged it ‘indeterminate’, and 22% stated it was ‘quite unlikely’. Regarding the likelihood of China overtaking the US as the largest military power a large majority, 79%, judged it ‘very unlikely/quite unlikely’, 16% ‘indeterminate’ and 5% rated it ‘very likely’. Regarding the likelihood that a ‘bipolar system’ will emerge in the Asia-Pacific, respondents leaned towards the affirmative, with 42% reporting this ‘quite likely/very likely’, 43% ‘indeterminate’ and 10% ‘quite unlikely’, and 5% ‘very unlikely.’ On the likelihood of a major crisis occurring between China and the US, 58% marked ‘indeterminate’, 10% ‘quite unlikely’ and 32% thought it ‘quite likely’. On the likelihood of a major crisis occurring between NZ and China, 69% judged this ‘very unlikely/quite unlikely’, 21% ‘indeterminate’, 5% ‘quite likely’, and 5% ‘very likely’.

Discussion

Most commentators believe China’s economy will overtake the US’s in the next ten years. On the one hand, a larger and more prosperous economy should result in increased demand for NZ’s dairy products and generate additional tourism for NZ. On the other hand, as China’s economy grows it will translate into greater Chinese influence throughout the Asia-Pacific region, buttressed by growing military capabilities. This will further alter the status quo and has the potential to create a more contentious bipolar Asia-Pacific region.

Respondents did not believe China’s military would be larger than that of the US in ten years. This may reflect the fact that it takes time for economic power to translate into new military might. In a sense then, if NZ’s close security relationship with the US is thought of as a ‘bet’ on who will be the predominant military power in the Asia-Pacific over the next ten years, then if this prediction holds true NZ decision makers have made the right choice for the time being. 

More than half of respondents reported that the likelihood of a major US-China crisis occurring over the next ten years was ‘indeterminate’, but one third believed it to be ‘quite likely’. This should not be a reassuring finding for NZ policymakers, as a major US-China crisis is the most likely reason that could lead NZ to be forced to ‘pick sides’ or adopt policies that threaten its relations with one or other state. NZ’s foreign policy ‘independence’ could be tested. On a positive note, 69% of respondents judge the likelihood of a major crisis occurring in NZ-China relations to be ‘very unlikely/quite unlikely’.

NZ-China: Potential sources of tension (economic, security, ideological/political)

The next set of questions asked whether the following three issues, economic, security, political/ideological, would give rise to tensions between NZ and China in the next 10 years. Responses were evenly distributed between 2 (‘quite unlikely’), 3 (‘indeterminate’) and 4 (‘quite likely’) on each count, with only one respondent rating economic issues ‘very likely’ to cause tensions. A related question asked whether participants thought the NZ government was taking appropriate steps to address these issues. A majority, 63% reported ‘yes’ and 37% ‘no’. Qualitative responses elucidating participants thinking on this question are included in the appendix.

US-China: Potential sources of tension (economic, security, ideological/political)

Five percent of respondents believed the chances of economic issues generating tension in the US-China relationship in the next ten years was ‘quite unlikely’, 37% ‘indeterminate’ and 57% ‘quite likely/very likely’. When it came to security issues, an overwhelming majority, 95%, believed it was ‘quite likely/very likely’ to cause tension. On the issue of whether cultural/ideological issues would generate tension, 53% felt it was ‘quite likely/very likely’, 37% ‘indeterminate’ and 10% ‘quite unlikely’. Across all three sets of issues a majority of respondents leaned towards there being a greater chance of tension occurring than not, with security issues being the most likely source. A related question asked whether participants believed the US government was taking appropriate steps to address these issues, with a majority of 63% reporting ‘yes’ and 37% ‘no’. Qualitative responses to this question are addressed below.

Discussion

Of the respondents that said the US government was taking appropriate steps, a number mentioned the value of security and economic initiatives established between the US and China, or what one called a ‘super structure of dialogue tracks’. This showed that both sides are ‘aware of differences but adapt to them and contains them within the policy that officially identifies China as a partner, not a rival or enemy.’ Many qualified their answers. One participant said ‘Yes but Washington acts with a realist mindset that may serve to heighten tensions’. Another believed ‘ultimately, appropriate adjustments would require the US to cede influence and accept China as an equal player in the economic and security spheres, which does not sit well with the US view of its global role’. Another stated that on security issues the US ‘should try and seek an agreement on the mutual accommodation of currently defined needs in the South China Sea, and give fresh consideration to joint initiatives on Korea and even possibly Taiwan.’

Six respondents noted that there were domestic issues in the US and China that could complicate the relationship. This included three respondents suggesting that a Trump presidency would jeopardise US-China relations; two respondents noting there is evidence of internal differences between hardliners and doves across the US system, resulting in internal disagreement over how robust the US response to China should be. Finally, one respondent believed ‘growing nationalistic sentiment within China’ could be a ‘barrier to managing the inevitable tension in the US-China bilateral relationship.’

Question 7 asked respondents if there were any indications that NZ’s increasingly close security/military relationship with the US is undermining or affecting its relations with China in any way.

A large majority, 90%, did not believe it was, with 10% saying ‘not yet’. Four respondents noted that China would be closely watching NZs messaging and positioning on issues of importance to China, such as the South China Seas. A respondent that captured both these points stated, ‘It was notable that China effectively fired a warning shot across the bows when it complained about NZ’s recent participation in an FPDA exercise in the South China Sea… Whilst NZ and most other regional states do not want to have to choose between China and the US, China may put pressure on them to choose Beijing over Washington.’ Other respondents suggested that NZ’s careful positioning and wording, for example not naming China in its response to the Arbitral Tribunal’s ruling (in October 2015) against Beijing and in favour of the Philippines on the South China Seas dispute, supports NZ’s independent foreign policy. This reduces China’s perception that NZ poses a threat. On this latter point, one respondent stated approvingly that ‘NZ tries hard to appear as independent as possible, with a ‘no surprises’ policy in order to re-assure China of its intentions’.

Question 8 asked if NZ’s increasingly close economic relationship with China is undermining or affecting its relations with the US.

A large majority, 95%, believed that it is not. One respondent said: ‘No, if it’s purely economic interests and relations. Yes, when this becomes part of Washington’s overall calculation of NZ’s value in US strategic relations with China’. Another said: ‘No. Some Washington commentators claim NZ is misty-eyed over the economic relationship but no signs this is the ‘official’ approach. There is good understanding in Washington of the reasons why NZ and many other US friends and allies have formed close economic ties with China.’ Another stated, ‘The US seems to understand and respect that as an exporting nation, NZ will have close economic ties with China… The US seems to regard NZ as a trusted partner in Asia, who can be relied upon to convey messages to China, despite the economic relationship.’

Discussion

The above comments should provide some reassurance for NZ policymakers as we can deduce that, in the eyes of the members of the NZ strategic studies community that took part in the survey, NZ’s expanding trade relationship with China has not played a role in undermining NZ-US relations (a survey of American officials and experts would be required to ascertain whether this view is mirrored in the US). However, as one respondent wrote, there is a potential that Washington could negatively view NZ trade relations with China in terms of the ‘overall calculation of NZ’s value in US strategic relations with China’. This statement is worthy of further reflection and suggests that, arguably, if Chinese-US relations were to deteriorate Washington could come to view its Asia-Pacific allies, including NZ’s, trading relationships with China as a factor that delivers relative gains to Beijing at the expense of Washington, leading Washington to encourage its allies reduce trade with Beijing.

Question 9 asked respondents if they ‘see any issue(s) that are arising, or might arise, in the next 10 years that could lead NZ to distance itself from either the US or China to maintain its relationship with the other?’

In response, 35% reported that they believed there was an issue that would arise, 30% reported ‘no’, and 35% stated ‘maybe’. This suggests that respondents lean by a slight margin towards ‘yes’ rather than ‘no’. Most qualitative responses suggested that NZ found itself attempting a precarious balancing act to retain positive relations with both in order to hedge against uncertainty, but that this position was fragile, as ‘any shifts in the international strategic environment will make such hedging difficult.’ Another said ‘Yes. It is not improbable that should Sino-US relationships deteriorate, that there will be implicit and explicit pressures for NZ to take sides.’ One participant said ‘Managing relations with the two large powers will be the single biggest challenge for NZ diplomatic tradecraft in the next decade and beyond. There is no obvious issue existing or likely to emerge in the medium term that would compel NZ to ‘make a choice’.’ The South China Seas was identified as a key issue.

Question 10 asked survey participants if ‘NZ welcomed the (Obama administration’s) ‘pivot to Asia?’  

A majority, 85%, believed that NZ welcomed the policy. The consensus was that America’s presence in the region was a ‘stabilising force’ and helped to ‘balance’ the growth of Chinese influence. One respondent said, ‘Quietly, yes, but avoided emphasising it. Many NZers are sceptical of it and of the US, so the NZG find no political capital in publicising it. The US warming is welcome because it validates NZ policy and assists the NZDF, that is, it serves NZ interests. But NZ has no wish to exacerbate US-PRC tensions by overtly taking one side or the other. So policy is an artful and pragmatic muddle.’ Another participant said NZ’s support for the policy came, in part, because Wellington did not view the pivot as a containment strategy vis-à-vis China.

Question 11 asked whether ‘NZ should try to play a role as an intermediary in US-China relations?’

50% responded ‘no’, 35% ‘maybe’ and 15% ‘yes’. Respondents who marked no were very strident in their position, with typical responses including: ‘Absolutely not – the concept of NZ as an ‘honest broker’ is the product of delusions of grandeur.’ Another said, ‘Absolutely not: it is likely to get crushed! Not only would trying to play such a role almost certainly be unsuccessful, it would most likely cause difficulties in NZ’s relations with both countries.’ Those who indicated ‘maybe’ suggested there could be value in this for NZ but only if Beijing and Washington were to welcome it. Two of the three respondents who said ‘yes’ elaborated, with one stating: ‘NZ can certainly play a constructive role between the two countries. In the process we can potentially have an outsize influence on both, although we need to walk a very fine line and choose our battles carefully to avoid being caught in the middle or being on the wrong side of issues.’ The other wrote, ‘Yes. NZ has excellent relations and, in that sense, is quite different from Australia.’

Question 12 asked if there ‘Is a risk to NZ from the unequal nature of the NZ-China relationship?

In response, 84% said ‘yes’, 11% ‘no’ and 5% ‘maybe’. Most respondents who marked yes, noted that China could use its economic leverage against NZ (and the region). For example, ‘China has shown itself quite ready to use its political influence to secure its economic goals, and vice versa. There is no reason to suppose NZ will be exempt from this.’ Another stated: ‘Yes. NZ will effectively be forced to accept things which are not necessarily in its own national interests.’ To some, this in turn requires American power to balance China, ‘Yes, the asymmetry of power in the relationship is a reality and a risk. We cannot wish it away. But there are ways to ‘manage’ the situation. NZ should do its best to support an active role for the US in the region. If the US is not actively serving as a balancer to Chinese power, China will seek to maximise its influence over small and medium size states. This has been the historical experience of the region when China was strong.’

Question 13 asked, ‘Should NZ take a public stance on territorial/sovereignty disputes between China and its neighbours over the South and East China Seas?’

A majority, 61%, responded ‘yes’ while 39% said ‘no’. Those in the affirmative suggested NZ had to take public stances in favour of international law to ensure large powers abided by the rules-based international system. Those who responded no believe the NZ government’s decision not to take overt sides was an appropriate one. Interestingly, a majority of both groups said it was important that NZ did not identify specific rule breakers, with one respondent believing that criticising China’s behaviour would not have clear benefits for NZ. One respondent, however, disagreed with this view, stating that NZ should not just ask others to ‘respect international law, but to actually adhere to it. NZ cannot say it supports a rules-based international system and then fail to condemn states, which flout the rules.’

A final question asked, ‘Is there anything else you would like to add regarding NZ’s relationship with the United States, and the potential national security implications for NZ of this triangle?’

Notable responses included that while non-government personnel might like more decisiveness from the NZ government, ‘in favour of the US and its democratic neo-liberal ideals, a nuanced examination reveals the wisdom of its current understated and ill-defined policies. Large majorities of the NZ public are sceptical of the US (and even more are sceptical of China) so keeping control of the policy narrative by avoiding energising these minorities is prudent NZG policy.’ One respondent saw some opportunity in the emerging situation, stating ‘there are opportunities stemming from the greater attention and consideration we get from two major powers both seeking to build influence in our region’. Another said that NZ’s ‘strategic dilemma’ should be viewed in a wider context, ‘When issues of international law emerge within ARF or EAS this is not just a situation of the US v China. Most of Asia (Australia, Japan and much of ASEAN) also look closely at our statements. There is also the principle that NZ regards as critical, which is the importance of international laws and norms – as a small state it is integral to our foreign policy independence. So issues like the South China Seas are not simply about which large power we are ‘siding with’. The stakes are far higher than that.  In the end, and NZ’s official statements to date deal with this, it is about thinking carefully about both values and in fact the majority of our global connections (including notably Australia, our most important relationship).’ Another response also recommended viewing NZ-US-China relations in regional terms stating, ‘In terms of national security, the main threat to NZ from the US-China relationship seems to come from a destabilisation of the wider region, rather than from a direct threat to NZ’s territorial integrity or political sovereignty’.

One response was at odds with the oft-stated position that NZ can successfully steer a middle path between Beijing and Washington, ‘Trying to maintain an equidistant relationship with the PRC and US when NZ is trade dependent on the PRC and security dependent on the US is akin to straddling a barbed wire fence while standing on ice blocks. The strategic competition between the US and PRC in the Asia-Pacific region is the ice that undermines the balancing act and at some point a hard choice will have to be made to go one way or the other.’

Final Comments and Future Research

We believe a key finding is that most survey respondents foresee a decline in US-China relations over the next 10 years. It’s possible that this response would have leaned even more heavily towards negative territory had the survey been undertaken after the 2016 US election. In particular, as Table 1 shows, 1/3^rd of respondents believe a ‘major crisis’ is likely to occur between the US and China. Given the stakes involved, NZ policymakers would do well to view this with some concern. Furthermore, if tensions rise we should anticipate that influence and pressure from Beijing and Washington could be brought to bear on regional states, even small ones like NZ, to make decisions they would prefer to avoid. How NZ calibrates its foreign policy with this in mind will be essential to NZ’s continued prosperity.

As a result of the survey’s findings, we believe there is significant scope for future research on many of the issues it raises. For example, how does Australia interrelate with NZ’s triangular relations? How are other small states in the region managing their divergent relations with Washington and Beijing? Can best practice insights between small states be shared? Is it possible that NZ’s economic ‘reliance’ on the Chinese market, and thus the potential influence this affords China over NZ, is less than it is sometimes claimed? And what steps to diversify away from the Chinese could be taken? (and is this actually desirable if we believe forecasts that China’s power will continue to rise?) There may also be value in Wellington conducting, in collaboration with academics, scenario planning for a range of contingencies. How would Wellington respond over an immediate crisis in the South China Seas where Washington or Beijing were requesting Wellington support for their respective positions? What position would NZ take if China were to make a rapid bid for regional hegemony? What if the US sought to pre-empt China’s continued rise by, say, forming a new Asia-Pacific alliance à la NATO, inviting NZ to be a member, or attempting a naval blockade of the Chinese mainland? After all, since WWII, US grand strategy has consistently sought to prevent the emergence of regional hegemons and forms of pre-emption may come to be viewed as a ‘rational’ option for a unipolar power that fears its position is slipping away. What would Wellington do in these situations? Is there value in considering the pros, cons, and mechanisms through which NZ could entertain alternative versions of strategic alignment? Does NZ have an effective ‘strategic foresight’ capability built into its government apparatus and can it be harnessed in a way that provides insight into how NZ could best be positioning itself today with the issues this paper has in mind?

While this article does not offer answers to the potential issues and complications inherent in NZ's place between the US and China, we hope the survey findings and issues they raise spur debate and reflection over what could become the greatest foreign policy challenge to NZ and many other small states in the Asia-Pacific this century. 

Acknowledgements

The authors would like to acknowledge respondents from the NZ strategic studies community that took the time to participate in the survey. 

Bio:
Reuben Steff is a lecturer of International Relations and Global Security at the University of Waikato in the Political Science and Public Policy Programme. His expertise and research interests lie in great power competition, with a focus on the intersection between nuclear deterrence and missile defence, the emerging technological aspects of the arms race, small states and New Zealand foreign policy. His latest co-authored book is “Dr Reuben Steff & Dr Nicholas Khoo, Security at a Price: The International Politics of US Ballistic Missile Defense (Rowman & Littlefield, November 2017).”

Francesca Dodd-Parr is a PhD student at the University of Waikato. She is currently working on research into decision-making in the housing policy space at a local government level. She is also interested in international relations, geopolitics and NZ national security. Her PhD is part of National Science Challenge 11, Building Better Homes, Towns and Cities for New Zealand.

Appendix: Full Survey Responses (qualitative)

1.     Do you believe the New Zealand Government is taking appropriate steps to address sources of tension (economic, security, ideological/political) between NZ and China?

·       Yes. The NZG is (and has been for decades) aware of its political, security, and economic differences with China but is committed to managing them within the overall framework of pursuit of mutual benefit so far with success.  I foresee few circumstances that would alter this save a ‘black swan’ event.

·       No, it is being responsive rather than taking the initiative in addressing likely causes of tension in the future.  

·       The New Zealand government may be aware of the issues, and it could be more pro-active in coming up with responses, rather than ad-hoc.

·       Yes.

·       Specific issues where differences arise are being well managed, without risk to the broad relationship important to both parties.

·       Yes. But it is difficult to speculate on future scenarios. Probably the test case is positioning prior to the Philippines arbitration case.  Minister McCully’s statements refer.

·       As a small state we also need to consider how best to approach the China relationship.  The tools for New Zealand are largely multilateral institutions, bilateral channels and public statements. We have to consider which is the most effective and influential combination on a case by case basis.

·       I am generally quite supportive of the Key government’s China policy, with one conspicuous exception, which I shall expand on here. This concerns Chinese ownership of New Zealand New Zealand private and commercial assets. The current New Zealand government needs to establish a clearer and more robust legislation to address this issue. For example, my view is that there is understandable frustration on the part of New Zealanders seeking to enter the housing marker, at the extent of the influx of Chinese (and other foreign nationals) purchases of housing in the Auckland region. This ‘problem’ has already extended to other parts of New Zealand. To be absolutely clear, while this is a complex issue, my view is that this is basically an internally generated problem, caused in no small part by lack of robust legislation by the Key government and the governments that preceeded it. In making real estate related investments in New Zealand, Chinese (and other non-New Zealand) nationals are simply acting in ways that are perfectly legal and rational. Therefore, why is the current government not adopting a more proactive approach on such an important matter? I’m puzzled by the degree of inertia displayed on such a critical aspect of New Zealand domestic policy that has clear potential to spiral into the foreign policy arena, affecting relations with China. After all, governments in Asia routinely use legislation to prevent the politicisation of housing issues. It is well past time for the Key government to act, in the interests of New Zealand, and other states (not least China) whose citizens are interested in investing in New Zealand.

·       No need to do more.

·       Probably not – there issues are relatively new and understandable preference during good economic times is to defer such problems.

·       NZ govt is paying undue attention to economic issues but much less to political/security issues.

·       On security and politics there is a limited amount to be done, other than increasing an awareness of the problems US-China relations are likely to give rise to. On economic and cultural issues, the New Zealand government should take concerted steps to plan in a coherent, whole-of-government way for China to play a much greater role in New Zealand trade, investment, education and tourism, and to encourage more Chinese language and cultural skills in New Zealand.

·       Yes, it’s playing the issues quite low-key in public, which is sensible.

·       Yes, but more effort needs to be taken to address public perception of the relationship with China and to re-evaluate NZ’s value to China.

·       Yes, to the extent it can. Given the power asymmetry in the relationship New Zealand will feel it has to appear conciliatory whenever problems arise.

·       Yes, basically. It is working quite pro-actively in addressing potential challenges.

·       The government seems to be working diligently to establish closer ties to China, both with the Chinese political and business elite, as well as people-to-people, which will be useful in dampening any tension that does flare up. These linkages could be useful in stopping tension developing into a full-blown crisis, but due to (in no particular order) (i) our imbalanced economic relationship, (ii) significant political and cultural differences, and (iii) divergent security interests, tension in the bilateral relationship seems inevitable. The government does appear to be laying the groundwork to deal with future tensions, but is perhaps overly accommodative towards China on economic issues to prevent tensions in that sphere from bubbling up. This is somewhat balanced by a tougher stance on security and human rights issues, although tension caused by NZ’s tougher stances have mostly stayed hidden from view.

2.     Do you believe the US Government is taking appropriate steps to address sources of tension (economic, security, ideological/political) between the US and China?

·       No, ultimately appropriate adjustments would require the US to cede influence and accept China as an equal player in the economic and security spheres, which does not sit well with the US view of its global role.  

·       Yes, but Washington acts with a realist mindset that may serve to heighten tensions.

·       Tensions are inevitable between the status quo power and the rising power. The US appears to be maintaining a balance between holding firm to the essentials of its position in Asia and with allies, and gradually allowing room to accommodate China’s emerging ambitions.

·       The US and China have both, in the last 5 years, set up a super structure of dialogue tracks to smooth out these problems.

·       The US Government recognises that there are both cooperative and competitive aspects to the bilateral relationship with China. At times, there seems to be disagreement between the White House, the NSC, and the State and Defense departments as to how robust the US response should be when tested by China.

·       The annual US-China dialogues on security and economics and hundreds of officials-level consultations mean the USG is aware of differences but adapts to them and contains them within the policy that officially identifies China as a partner, not a rival or enemy. Individual officials (CINCPAC, cyper command) and non-government individuals are more outspoken in criticism of China, or warning of ‘coming war’ etc.  But this is not White House or State posture.

·       No

·       US needs to engage more effectively on economic front esp re: TPP, but also in exploring engagement with AIIB and One Belt One Road.

·       Not enough.

·       On the whole, yes. On trade, in the unlikely event of TPP being put into effect the next US administration should try to get China included. It should also try and participate in AIIB. On security, it should try and seek an agreement on the mutual accommodation of currently defined needs in the South China Sea, and give fresh consideration to joint initiatives on Korea and even possibly Taiwan. Of course if Donald Trump becomes president the prospects in all these respects will be highly uncertain.

·       No. At the moment the election is taking all attention and subsequent responses will depend on the outcome

·       No, the US government’s handling of the relationship is largely driven by domestic [political] considerations.

·       Yes

·       The US Government recognises that there are both cooperative and competitive aspects to the bilateral relationship with China. At times, there seems to be disagreement between the White House, the NSC, and the State and Defense departments as to how robust the US response should be when tested by China. The fundamental nature of many of the ongoing and potential problems is such that they are unlikely to be ameliorated unless China adopts a different posture or the US decides to concede. It should go without saying that the whole nature of US-China policy could change considerably depending on the outcome of the US presidential election.

·       Generally, yes. The US is working pro-actively with engaging China’s leadership on economic, political and security differences. Still differences over the South China Sea, for example, could result in an accident or inadvertent crisis.

·       Bilateral tension in all of the above spheres is constant, and likely to remain so, though the intensity varies. The US government is managing tension with China relatively well, pushing back on some issues and cooperating productively on others. However, the policies of the next US administration are unknown, and the current political climate in the US could push politicians to advocate stricter policies against China. On the flipside, growing nationalistic sentiment within China, sometimes encouraged by the government, could prove to be as much, if not more of, a barrier to managing the inevitable tension in the US-China bilateral relationship.

3.     Are there any indications that NZ’s increasingly close security/military relationship with the US is undermining or affecting its relations with China in any way?

·       Not yet, although this may not be the case in the future. It was notable that China effectively fired a warning shot across the bows when it complained about New Zealand’s recent participation in an FPDA exercise in the South China Sea, so friction with China over the close NZ-US military relationship cannot be ruled out. Whilst New Zealand and most other regional states do not want to have to choose between China and the US, China may put pressure on them to choose Beijing over Washington.

·       None that I’m aware of.  NZ’s favourable response to the Arbitral Tribunal’s ruling on the SCS artificial islands came close to raising tensions with Beijing but it was carefully worded and did not actually name China.   I’m not aware of any top-level Chinese criticism of the Washington Declaration or other US initiatives to link with NZ, in comparison with PRC criticism of Australia’s close links with the US and Japan.

·       Not that I know of, but it is something that China will be monitoring closely. 

·       On the surface New Zealand tries hard to appear as independent as possible, with a “no surprises” policy in order to re-assure China of its intentions. Underneath, NZ’s relationship with USA is much deeper (given revelations of GCSB and NSA cooperating in hacking).  China has sent messages accordingly.

·       It’s a potential concern for China, but the level of NZ security/military relations US is not “close” enough to significantly affect its relations with China.   

·       There are occasional public comments of a cautionary character, but no indication that China is re-thinking its strategic defence relationship with New Zealand.

·       No evidence of this; perhaps NZ is not viewed as threatening and certainly has demonstrated a more independent foreign policy. There is evidence that it helps us improve our relationships with a number of other Asian countries who also lean towards the US.

·       No.

·       Not at this stage but this is possible.

·       Not really as yet.

·       Not yet.

·       Not yet, no.

·       Not that I’m aware of.

·       No. China understands the relationship NZ has with the US. They are not frightened by them.

·       Yes.

·       Not yet, although this may not be the case in the future. It was notable that China effectively fired a warning shot across the bows when it complained about New Zealand’s recent participation in an FPDA exercise in the South China Sea, so friction with China over the close NZ-US military relationship cannot be ruled out. Whilst New Zealand and most other regional states do not want to have to choose between China and the US, China may put pressure on them to choose Beijing over Washington.

·       I don’t really see evidence of this. China seems to see some benefit to itself of NZ having close security ties with the US.

·       Not to my knowledge. NZ seems eager to balance the increasingly close security relationship with the US by bringing China into the fold on security issues where it can.

4.     Are there any indications that NZ’s increasingly close economic relationship with China is undermining or affecting its relations with the US in any way?

·       None.  The US and NZ are together on urging China to comply with WTO disciplines, and to join the TPP.

·       Not that I know of

·       No. NZ’s relations with the US are only getting stronger.

·       No, if it’s purely economic interests and relations. Yes, when this becomes part of Washington’s overall calculation of NZ’s value in US strategic relations with China.

·       No. Some Washington commentators claim NZ is misty-eyed over the economic relationship but no signs this is the ‘official’ approach. There is good understanding in Washington of the reasons why NZ and many other US friends and allies have formed close economic ties with China.

·       That’s more or less the same situation that every country in the Asia/Pacific is in, including the US. 

·       No.

·       No.

·       No.

·       Not really.

·       Not yet, no.

·       Not that I’m aware of.

·       Only to the extent that in its absence China is becoming more important as an economic partner than the US.

·       No.

·       No.

·       No, I don’t think so. China today is the most important economic partner with many countries US friends and allies in the region.

·       The US seems to understand and respect that as an exporting nation, NZ will have close economic ties with China. As our economic ties with China have increased dramatically, so have our political and military ties with the US, while our economic ties with the US have also increased, although not at the same scale or pace. The US seems to regards NZ as a trusted partner in Asia, who can be relied upon to convey messages to China, despite the economic relationship.

5.     Do you see any issue(s) that are arising, or might arise, in the next 10 years that could lead NZ to distance itself from either the US or China so as to maintain its relationship with the other?

·       Any forcing of a choice will have to come from either Beijing or Washington; a choice will not be made by Wellington, and even if a choice is urged by a great and powerful friend, Wellington will try to dodge it, as it did the Iraq invasion, and Wellington will then emphasise other policies that will placate the demandeur. 

·       As a balancing act, any shifts in the international strategic environment will make such hedging difficult.

·       Managing relations with the two large powers will be the single biggest challenge for New Zealand diplomatic tradecraft in the next decade and beyond. There is no obvious issue existing or likely to emerge in the medium term that would compel New Zealand to ‘make a choice’.

·       Yes. It is not improbable that should Sino-US relationships deteriorate, that there will be implicit and explicit pressures for New Zealand to take sides.

·       The most likely issue would be a serious escalation in the South China Sea. If China decided to play hardball in the event of a major action, by either the US or China, they could apply significant pressure on NZ to distance ourselves from the US. Likewise, the US, while likely to understand our economic interests in such a scenario, would likely apply pressure on us to take a tougher position than we may be comfortable with. Both sides would wield considerable leverage over NZ in the event of a major incident or escalation of tension in the South China Sea.

·       The formal policy is that there is, and won’t be, any contradiction, contra to Rob Ayson’s views.  Any forcing of a choice will have to come from either Beijing or Washington; a choice will not be made by Wellington, and even if a choice is urged by a great and powerful friend, Wellington will try to dodge it, as it did the Iraq invasion, and Wellington will then emphasise other policies that will placate the demandeur. 

·      The two relationships will be a factor in NZ policymaking in many areas, but I think the most likely scenario would be for NZ to make a decision onthe merits of a particular situation that would have the incidental effect of enhancing or detracting from one or the other of the relationships. 

·       NZ needs both China and the USA and therefore needs to be more engaged with both.  It hedges on a closer economic relationship with China, and as a “strategic partner” in the Pacific region, while cooperating with the USA militarily at levels not see for 30 years. As a balancing act, any shifts in the international strategic environment will make such hedging difficult.

·       How hard will US continue to push for its Pivot to Asia; Directions of further development in regional economic institutions; China’s interests and investment in economic relations with NZ further expand.

·       Managing relations with the two large powers will be the single biggest challenge for New Zealand diplomatic tradecraft in the next decade and beyond. There is no obvious issue existing or likely to emerge in the medium term that would compel New Zealand to ‘make a choice’.

·       If either side disturbs the current order (including international laws and norms) in some substantive way then NZ should be prepared to note that bilaterally.

·       Yes. It is not improbable that should Sino-US relationships deteriorate, that there will be implicit and explicit pressures for New Zealand to take sides.

·       If China goes onto the military offensive in Southeast Asia (unlikely) NZ could distance itself from China.

·       Possibly – but will depend primarily on how China chooses to exercise its power in the region and in NZ which affect NZ interests.

·       Three issues

o   Political chaos in China

o   Economic crisis in China

o   Isolationism in the US

·       Yes. In a crisis one or other side might insist on New Zealand taking a less impartial position than it has striven to do to date.

·       Obviously, the possibility exists in either direction, but NZ seems to be attempting (sensibly) to balance the relationship.

·       NZ will want to continue to maintain a balance between the two.

·       Yes.

·       I think New Zealand will find it increasingly hard to avoid making some sort of choice as the previously parallel tracks of its politico-military and economic interests begin to converge.

·       NZ relations with China could be negatively affected if China-US tensions escalate particularly in the South and East China Seas.

·       The most likely issue would be a serious escalation in the South China Sea. If China decided to play hardball in the event of a major action, by either the US or China, they could apply significant pressure on NZ to distance ourselves from the US. Likewise, the US, while likely to understand our economic interests in such a scenario, would likely apply pressure on us to take a tougher position than we may be comfortable with. Both sides would wield considerable leverage over NZ in the event of a major incident or escalation of tension in the South China Sea.

6.     Has New Zealand welcomed the US ‘Pivot to Asia’ (rebalance)? If so – why?

·       Quietly, yes, but avoided emphasising it. Many NZers are sceptical of it and of the US, so the NZG find no political capital in publicising it. The US warming is welcome because it validates NZ policy and assists the NZDF, that is, it serves NZ interests. But NZ has no wish to exacerbate US-PRC tensions by overtly taking one side or the other. So policy is an artful and pragmatic muddle. This must be frustrating to those who want clarity and focus. 

·       Yes because we perceive the US as a stabilising force in the region.

·       Yes, the Defense White Paper sees the strengthening of US-NZ relations between their armed forces as enhancing NZ’s regional security.

·       “Welcome” is perhaps not a right description of NZ’s position and interests on this.

·       Yes. A strong and committed US presence in the Asia-Pacific is essential to maintenance of a stable region environment that is conducive to economic progress.

·       Yes, New Zealand is on record as being in support of the Pivot. Minister Coleman’s statements around the Washington Declaration signing refer. It would be the majority view of states in the Asia/Pacific that maintenance of a US presence in the region is a stabilising factor.  Most lean to the US, although expect to also have a solid relationship with the US. The Pivot should not be viewed as a containment strategy (which it clearly is not – granted that China’s official statements dispute this), but it is a shaping and hedging strategy. And while China is a big part of the pivot, we do not see it as the sole security question in the Asia-Pacific. The pivot is a range of diplomatic and military initiatives (and hopefully TPP will one day add an economic dimension) that covers a range of security contingencies, from natural disasters to the current dire situation on the Korean Peninsula.

·       Yes, New Zealand has welcomed the rebalance. The reason is clear: to ensure regional peace and stability. The US is a force for stability in the Asia-Pacific

·       The NZ Government has welcomed the US ‘pivot’ but many NZ observers are concerned about the ‘containment of China’ simplifications of the ‘pivot’.

·       It seems so, mostly because a stronger US economic + military presence can serve to balance a rising China and the uncertainties that presents.

·       Yes, mainly for security reasons.

·       New Zealand has responded cautiously to the rebalancing policy, or rather tried to avoid responding explicitly. Why? Simply because its attitude has been determined by its interest in sustaining good relations and even improving relations with Washington while doing the same with China.

·       Yes, it makes sense for the US to be deeply involved diplomatically, economically, socially, militarily, but as primus inter pares rather than ‘leader’.

·       Yes. A more engaged US in Asia strengthens security and economic conditions and therefore benefits NZ.

·       Yes, in order to maintain a strategic balance in the region.

·       Yes, because it has undoubtedly enabled and accelerated the rebuilding of the New Zealand-US military relationship as Washington has sought Wellington’s participation and support.

·       Yes, it has. NZ sees the value of the US seeking to provide countries in the region, particularly in Southeast Asia, Korea, and Japan at least some counterbalance to China’s increasing assertiveness in the South and East Chia Seas and continuing support for North Korea.

·       Yes, because (i) the Government sees a role for NZ as a facilitator of the US-China relationship, and (ii) it should lead to increased US engagement in both Asia and the Pacific, including New Zealand. It has also spurred the TPP, although the agreement may be torpedoed by the US Congress.

7.     Should New Zealand try to play a role as an intermediary in US-China relations?

·       Absolutely not the concept of NZ as an ‘honest broker’ is the product of delusions of grandeur. 

·       Yes, but only if invited jointly by both parties. Very difficult to see where a unilateral initiative to seek such a role would be welcomed or could be helpful. What is important is to have access to senior political/policy leaders and the ability to talk to both sides.

·       Absolutely not: it is likely to get crushed! Not only would trying to play such a role almost certainly be unsuccessful, it would most likely cause difficulties in New Zealand’s relations with both countries.

·       It really can’t play a major intermediary role, although it can serve to carry messages between the two of them from time to time.

·       New Zealand can certainly play a constructive role between the two countries. In the process we can potentially have an outsize influence on both, although we need to walk a very fine line and choose our battles carefully to avoid being caught in the middle or being on the wrong side of issues.

·       If asked by either side, yes. But other than working productively with each in turn, e.g. in the UNSC or APEC or RCEP or ADMM+ or ARF, NZ should not put its and up. It would produce risks and costs that would far outweigh the benefits (if any) ‘blessed be the peacemaker’ but dismissed as naïve is the failed idealist, e.g. NZ initiative to bring Israel and PA to the table.

·       No. While NZ can share perspectives and views, neither China nor Washington need a third party intermediary.

·       There is potential for NZ to have that influence.

·       Yes, but only if invited jointly by both parties. Very difficult to see where a unilateral initiative to seek such a role would be welcomed or could be helpful. What is important is to have access to senior political/policy leaders and the ability to talk to both sides.

·       Only if these countries ask for it, which they are not.  What would we be offering?  No country currently plays a role like that.

·       No.

·       No – this would be seen by both sides as being presumptuous!

·       No – at least not formally.

·       Only to a very limited extent.

·       Only in very modest ways in very particular circumstances. It is too small a player to have any except a peripheral influence on the relationship.

·       No.

·       No. We should focus on our interests and we are at best a marginal player in terms of the US & China.

·       Yes.

8.     Is there a risk to NZ from the unequal nature of the NZ-China relationship? (i.e the difference in the two nation’s economic size and scale)

·       Yes, the asymmetry of power in the relationship is a reality and a risk. We cannot wish it away. But there are way to ‘manage’ the situation. New Zealand should do its best to support an active role for the US in the region. If the US is not actively serving as a balancer to Chinese power, China will seek to maximise its influence over small and medium size states. This has been the historical experience of the region when China was strong.

·       Yes. Elsewhere China has shown itself quite ready to use its political influence to secure its economic goals, and vice versa. There is no reason to suppose New Zealand will be exempt from this.

·       Yes. New Zealand will effectively be forced to accept things which are not necessarily in its own national interests.

·       Yes – China holds considerable leverage over NZ due to its size. NZ has so far proven adept at managing this and being treated more or less as equals, although NZ should be prepared for China to occasionally throw its weight around.

·       Yes. Unexpected adverse trade policies could damage NZ severely but NZ policies are insignificant to China. 

·       Of course, it makes NZ vulnerable to pressure from China. This is no different from the pressure we have been subjected to in the past by other major economic partners such as the UK, France, the EC, the US and Australia. 

·       China can turn on or off trade in response to anything it may be upset with, or at least to signal dissatisfaction. 

·       Yes, same as with the NZ-US relations.

·       Significant scale differences are a standard feature in all New Zealand’s major relationships. Managing those disparities so as not to become overly dependent is at the core of NZ statecraft. The China relationship is no different, we are not at Beijing’s beck and call.

·       The risk is one of over dependence on a single market – much like the situation we were in with regards to dependency on the UK market. When the market disappears or hits troubled waters, a vulnerable economy needs the alternatives. That said, we have done extremely well out of the Chinese market, which helped us ride out the GFC without really much impact.

·       Yes – hence the importance of broadening the bilateral relationship

·       Absolutely. China is building significant leverage.

·       NZ should learn to deal with individual provinces as well as China as a whole.

·       No.

·       Yes definitely. Making the relationship more complicated to manage, and harder for NZ to have impact in China.

·       Yes.

·       Of course, there is always that risk particularly on the economic front as NZ becomes more active in trading and investing with China, but NZ so far has sown itself to be quite shrewd in maintaining its independence. 

9.     Should NZ take a public stance on territorial/sovereignty disputes between China and its neighbours over the South and East China Seas?

·       NZ should stand firmly on international law but avoid identifying international law-breakers, which would make NZ part of the problem.

·       Not unless NZ interests are directly involved, or there is an egregious and clear cut violation of international law. 

·       No. NZ’s public stance is not to take a position – only opposing any action that undermines peace and trust, and to support recourse through international dispute settlement processes/institutions or direct negotiation.

·       No, and NZ’s current position is fine. There is no solid basis upon which NZ can form a more substantive stance. Benefits in taking such a stance are not entirely clear. 

·       The government’s public comments have been carefully nuanced, with appropriate emphasis on the importance of the norms of international law but without taking sides over particular disputes.

·       New Zealand has made public statements on this. See statements by Ministers McCully and Brownlee.  Such statements are often carefully worded, but we are in support of UNCLOS and a peaceful resolution of this situation.

·       New Zealand already has. It should continue to do so.

·       Not beyond reaffirming NZ’s commitment to the rule of law globally.

·       Probably not necessary.

·       Yes.

·       No, other than by urging all parties to seek a peaceful resolution of the disputes concerned, as it has done. From a realist perspective there would be no benefit in taking a more explicit public stance, and in any case the rights and wrongs of the disputes are complicated.

·       No.

·       We should continue to stick to an established posture: we look to international rules and expect all countries to abide by them.

·       Yes.

·       Whilst it should continue to refrain from taking positions on sovereignty claims of the disputants, it should adopt a firmer position on the need for the parties concerned to not only respect international law, but to actually adhere to it. New Zealand cannot say it supports a rules-based international system and then fail to condemn states which flout the rules (e.g. China and the Permanent Court of Arbitration ruling).

·       Yes NZ should communicate its concerns about wanting to see the rule of law maintaining and the avoidance of the use of forces to resolve territorial disputes. OF course, NZ should not take sides on who owns what.

·       Yes – NZ’s interests are clearly served by large countries, such as China, adhering to international law and international norms. We of course must be careful not to significantly jeopardise our economic interests, but nonetheless, on security issues affecting the stability of the wider Asia-Pacific, and impacting US-China relations, we should make our commitment to international law and the pacific settlement of disputes publically known, and stand up for those fundamental values and interests.

10.  Is there anything else you would like to add regarding New Zealand’s relationship with China, and/or its relationship with the United States, and the potential national security implications for New Zealand of this triangle?

·       While we academics, and policy analysts, and military officers, would like more decisiveness, courage, and moral backbone from the NZG, presumably in favour of the US and its democratic neo-liberal ideals, a nuanced examination reveals the wisdom of its current understated and ill-defined policies. Large majorities of the NZ public are sceptical of the US (and even more are sceptical of China) so keeping control of the policy narrative by avoiding energising these minorities is prudent NZG policy. The visit by the US Navy ship in November will test the NZG’s skill in narrative management.

 

·       As well as the risks, there are opportunities stemming from the greater attention and consideration we get from two major powers both seeking to guild their influence in our region.  

·       NZ and USA share common values, laws and language and a longer history of joint involvement.  Our value systems are fundamentally linked. With China, the relationship is more recent and developing and ultimately will become stronger too.  Continued engagement through thick and thin is the key.

·       After the special and enduring ties with Australia, there are the two paramount bilateral relationships with New Zealand. They are many-hued and multi-faceted. While complex they can be managed without damage to New Zealand’s core national interests.

·       We are a Strategic Partner of the United States and have an important partnership with China. These relationships are different, qualitatively, and both are important to manage.   In the event of a major crisis, depending on who is at fault, NZ would be in a position to make representations to either side. It should also be noted that NZ’s strategic dilemma cannot be simply boiled down to US and China, which is frequently the way the question is framed. When issues of international law emerge within ARF or EAS this is not just a situation of the US v China. Most of Asia (Australia, Japan and much of ASEAN) also look closely at our statements. There is also the principle that New Zealand regards as critical, which is the importance of international laws and norms – as a small state it is integral to our foreign policy independence. So issues like the South China Sea are not simply about which large power we are “siding with”. The stakes are far higher than that.  In the end, and New Zealand’s official statements to date deal with this, it is about thinking carefully about both values and in fact the majority of our global connections (including notably Australia, our most important relationship). (The situation in Crimea/Ukraine also refers.). On our 5 Eyes partnerships, the majority of states in our region have intelligence agencies, and, one can assume, intelligence relationships of their own.  The world is awash with such arrangements. I think that is well understood that NZ will have its own arrangements in this space, particularly amongst states who possess very large intelligence gathering apparatuses of their own.

·       Handling ‘this triangle’ is likely to be the most challenging diplomatic issue NZ has ever faced.

·       NZ is a small nation with no geopolitical interests in getting caught between the two superpowers.

·       The New Zealand Government would do well to develop contingency plans for (a) its burgeoning relations with China (see point 4 above), (b) a sudden deterioration in triangular relations.

·       There don’t have to be security implications if it’s properly handled.

·       I think New Zealand is too small and unimportant to be part of any triangular relationship with China and the US though I know what the question means. It might be better to think of an Australia-China-US triangle and how this affects New Zealand. It will be difficult for New Zealand to continue to adhere to a softer policy towards China, as the line across the Tasman hardens, without becoming very out of step with our principal ally.

·       Trying to maintain an equidistant relationship with the PRC and US when NZ is trade dependent on the PRC and security dependent on the US is akin to straddling a barbed wire fence while standing on ice blocks. The strategic competition between the US and PRC in the Asia-Pacific region is the ice that undermines the balancing act and at some point a hard choice will have to be made to go one way or the other. The best way to resolve the dilemma is to act as an intermediary between the two powers while recognising the respective dependence on each.

·       NZ is well positioned to improve our relationships with both countries, particularly in areas where they are underperforming – for instance economically with the US, and politically/militarily with China. NZ can also play a constructive role as a go-between in the US-China relationship, thereby allowing us to “punch above our weight” with both countries and on the international stage. Nonetheless, this is a difficult and potentially treacherous role to play, and we must manage it very carefully, as the potential consequences of failure are high. In terms of national security, the main threat to NZ from the US-China relationship seems to come from a destabilisation of the wider region, rather than from a direct threat to NZ’s territorial integrity or political sovereignty.

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^[1] Reuben Steff & Francesca Dodd-Parr, ‘Examining the Immanent Dilemma of Small States in the Asia-Pacific: The Strategic Triangle between New Zealand, the US and China’, Pacific Review (January 2018, available online. Free e-print access: http://www.tandfonline.com/eprint/TypQnQ7ukRRtqQkAmUKB/full)