China and New Zealand have enjoyed decades of mutual benefits.
The global powerhouse and New Zealand signed a Free Trade Agreement in 2008 and since then have phased in provisions to ease trade between the two countries.
China is now New Zealand’s largest trading partner, followed by Australia. Suffice to say it’s a relationship New Zealand can’t afford to lose.
Fallout from the Government taking the United States stance on the Huawei debate and now reports of people not wanting to come to New Zealand as a result are threatening the country’s long-standing friendly relationship.
Exports of dairy products, increasing tourist numbers and foreign students have been of significant benefit to New Zealand in the past decade, and dozens of businesses, including New Zealand’s largest company, such as Fonterra, rely heavily on trade from China.
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New Zealand exports of all goods and services to China were worth $16.6 billion in the year ended September 2018, Stats NZ said. Sales of major export products of dairy produce, logs and wood and meat have increased year on year over the past three years.
Travel is New Zealand’s largest export to China and spending by Chinese visitors contributed $1.6b to the economy last year.
About 448,000 Chinese nationals visited Aotearoa last year, according to the latest international travel figures, up from around 100,000 a decade ago. Approximately 132,000 Kiwis visited China last year.
Nick Siu, director of consultancy firm The Agency 88 which specialises in Asian markets, said he was surprised at the Government’s seemingly lack of effort to reconcile tensions given China is the country’s most important trade partner.
The relationship between New Zealand and China was “incredibly important”, Siu said, not only because of the huge volumes of trade and tourism but because New Zealand was home to around 260,000 people who identify ethnically as Chinese.
Fall out from diplomatic tensions could stall hit tourist numbers to New Zealand and therefore the wider economy, he said.
“Chinese are big spenders. Only six per cent of Chinese even have passports so there’s a huge opportunity and benefit for New Zealand to stay friendly to ride that wave of growth as Chinese start to move away from inbound tourism,” he said.
“Presently, New Zealand and Australia is the seventh most desirable region to travel [among Chinese] and the second non-Asian country.
“They spend 2:1 times more than Americans do so when they’re coming they’re not just walking around – they are spending money that’s pumping money around the local economy through the local shops, through the local services, through buying local.”
Nick Siu, director of the Agency 88. Photo / Supplied
Contrary to China’s significance to New Zealand, the country is a very small trading partner from China’s perspective, Siu said.
Siu said a lack of recent visitation between the countries’ elite signalled the relationship between the countries was strained. He believes the Government needs to reach out to make amends.
“I find it extremely surprising that they haven’t,” he said.
“Keeping a relationship with anybody, let alone your biggest trade partner, one would think a simple visit would be on the cards and a high priority.”
University of Auckland senior lecturer of international relations, Stephen Noakes, said Chinese authorities would be disappointed at how the Government managed fallout from the Huawei debate but said the impact could be “much worse”.
“The relationship between New Zealand and China has long been compared to say US and China or Canada and China [but] much friendlier. There are more back channels, society- to-society connections, and I don’t see recent events as up-ending those a whole lot.”