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When Australia’s Prime Minister Scott Morrison met his New Zealand counterpart Jacinda Ardern in the idyllic surroundings of New Zealand’s Queenstown earlier this week, both leaders were keen to say how close the relationship is between their two countries.
Mr Morrison spoke of the two countries as a “family”, and that is hardly an exaggeration. There are probably no two countries in the world that are more alike in so many aspects of their national life as these two former outposts of the British Empire in the South Pacific.
And yet, like any family, they have their differences – and those differences can be harder to manage precisely because the two countries are so close. There are always a host of low-level irritants between them, but things get tougher when they differ about issues that are truly fundamental and highly contentious. Issues like how to deal with China.
China is vital to both countries’ economies, as both their largest export market and the biggest potential source of future economic opportunities. But its increasing authoritarianism at home and its growing power and assertiveness in the region pose real threats to interests and values that Australia and New Zealand share. Managing this dilemma is a massive policy challenge in Canberra and Wellington alike.
In many ways, the two countries have taken similar positions. They have criticised Beijing over Hong Kong and Xinjiang, scrutinised Chinese investment, limited Huawei’s role in 5G systems, and opposed some of China’s actions in the South China Sea.
But differences in the way they have articulated their positions have produced very different results. Australia under Mr Morrison has been highly assertive, even strident, in its criticisms of Beijing, while New Zealand has been more moderate and measured. As a consequence, while relations between Beijing and Canberra are frostier than at any time in the last 50 years, the China-New Zealand relationship is doing fine.
Australian exports to China have been hit by bans on many key commodities, while New Zealand’s trade has flourished. And while Beijing unleashes a steady flow of invective against Canberra, it speaks warmly of relations with Wellington.
This disparity can be attributed to two aspects of New Zealand’s approach. The first is that New Zealand has kept its voice down. Mr Morrison has been eager to advertise his “tough on China” stance, making it a key element of his political sales pitch both domestically and internationally. Ms Ardern has made many of the same points as Mr Morrison, but has refrained from grandstanding.
The Quad and ‘Five Eyes’
The second difference is that Wellington has not been as eager as Canberra has been to join collective action with America and its friends and allies aimed at containing China. Australia has enthusiastically promoted the Quad, which brings together America, Japan and India in what Washington sees as a key asset in its strategic contest with China, and which Beijing sees as an anti-China coalition. New Zealand has not joined.
Likewise, New Zealand has been reluctant to see a longstanding intelligence grouping – the so-called “Five Eyes” arrangements between the US, Britain, Canada, Australia and New Zealand – repurposed as a diplomatic and strategic alliance.
For 80 years, the formerly super-secret Five Eyes system managed cooperation between its members in producing signals intelligence, but now it is coming to be used as a vehicle for common action against China. Australia has strongly welcomed this shift, while New Zealand has resisted it.
New Zealand’s Foreign Minister Nanaia Mahuta has said that she does not think it appropriate to join other Five Eyes members in joint statements criticising China, arguing that Wellington “would prefer to look for multilateral opportunities to express our interests”.
Inevitably, these differences in approach on such a key issue have caused some tensions between Canberra and Wellington, and these have been fuelled by some frank and unwelcome advice to Canberra from across the Tasman Sea about how Australia might manage relations with China better. Ms Mahuta has suggested that both Beijing and Canberra needed to “concede in some areas where they are currently not seeing eye to eye”.
Her colleague, New Zealand Trade Minister Damien O’Connor, has gone even further, saying that Australia should show more “respect” and “diplomacy” in its dealings with China. None of this has gone down well in Canberra, where Mr Morrison has defended his confrontational approach to Beijing by arguing that it is impossible for Australia to compromise with China because that would betray the country’s interests and values.
Not surprisingly, Beijing has been happy to play up the differences between Australia and New Zealand, but Ms Ardern has been equally keen to play them down. Wellington has long affirmed that Australia is by far New Zealand’s most important international partner, including as its key strategic ally. Australia’s much bigger size and weight make the relationship inherently asymmetrical, and Wellington is always careful not to let tensions get out of hand.
That is especially so in the current situation because differences over China revive memories of an earlier crisis in relations when, at the height of the Cold War in the mid-1980s, an earlier Labour Party government banned visits by nuclear-powered and nuclear-armed warships to New Zealand. This caused a rupture in the trilateral Anzus alliance with Australia and America. Washington scrapped its alliance commitments to Wellington, and relations with Canberra were very severely tested.
Ms Ardern has no interest in plunging her Labour government into the same kind of crisis, especially as it would endanger not just relations with Canberra, but relations with Washington too, which have never fully recovered from the Anzus split almost 40 years ago. That is why she moved so decisively to smooth things over when she met Mr Morrison in Queenstown last weekend. She has no interest in scoring points in Beijing at the expense of relations with Australia.
And yet, for all the warm words and talk of “family”, real differences remain between Australia and New Zealand as both countries face what is one of the most difficult and important foreign policy challenges either has faced in their histories. And those differences are not merely matters of contrasting style between Ms Ardern’s low-key charm and Mr Morrison’s habitual abrasiveness.
Different threat perceptions
The reality is that, despite the very real and deep parallels in so many aspects of their histories, cultures, traditions and values, Australia and New Zealand are different countries with different experiences and perceptions, which will inevitably shape the way they respond to China’s rise.
For a start, their economic perspectives are different. For the past 50 years, Australia has grown prosperous, thanks to massive exports of minerals and energy resources to the booming economies of North Asia. That remains true today, with Australia still the main source of iron ore for China’s furnaces, and record-high prices more than offsetting the income lost from Chinese import restrictions on other commodities. That has made Australians complacent about their prosperity.
New Zealand’s experience has been very different. Without Australia’s mineral endowments, it has often struggled to find markets for its agricultural exports, and has slipped well behind Australia in per capita gross domestic product. Moreover, it would be much easier for China to find new sources of key New Zealand exports like milk powder than to replace Australian iron ore. So while Australia has, so far at least, felt able to laugh off China’s trade sanctions, New Zealanders feel much more vulnerable.
But it is not just economics, because political and strategic perspectives are different too. Although they both began as loyal members of the British Empire, Australia and New Zealand have developed rather different outlooks on the world around them.
Perhaps because it is more remote, New Zealand has never felt as closely engaged with Asia as Australia has done, but it has also never been as anxious about potential Asian threats. That means New Zealanders are less worried by China’s looming power than Australians.
They are also much less inclined to look to America to keep them safe. Wellington is keen to have strong relations with Washington, but it does not share Canberra’s fervent embrace of America as the essential foundation of its security. Having lived without an alliance with America for so long, New Zealanders are less alarmed than Australians by the idea that American power in Asia might fade as China’s grows.
In other words, although both governments talk about the need to engage more closely with their Asian neighbours to help deal with China, New Zealand’s cautious, low-key approach is much closer to South-east Asia’s, South Korea’s or even Japan’s than Australia’s stridency against Beijing. In the long run, dealing with China may draw New Zealand closer to these countries, while Australia drifts further apart from them. New Zealand’s may prove the more prudent path.
• Hugh White is emeritus professor of strategic studies at the Australian National University in Canberra.