Commentary
President Xi Jinping’s visit comes as New Zealand’s relationship with China enters a period of historic strength. Two way merchandise trade is booming. Trade in services is growing across the board. Investment is expanding. The flow of people between New Zealand and China continues to increase, leading to deeper personal connections, greater goodwill and better mutual understanding.
While we have much to celebrate, we must also acknowledge the many decades of hard work that laid the foundations for today’s successful relationship. New Zealand was the first developed country to recognise China as a market economy, to complete negotiations on China’s entry to the WTO, to enter into FTA negotiations with China, and to complete an FTA with China.
This hard work has to continue if we are to build on and consolidate the relationship. The visit by President Xi Jinping sends a hugely powerful signal about the importance China places on its relationship with New Zealand. From our side, Prime Minister John Key has clearly demonstrated his commitment to China by establishing the New Zealand China Council.
The Council’s priorities are to increase economic performance through greater trade access and development and value from investment, to build capacity among New Zealand companies and organisations engaging with China, to influence leadership at all levels, and to change perceptions by informing the general public and encouraging language acquisition. In each of these critical areas, work continues to ensure our relationship remains resilient into the future.
Trade
On the trade front, the target of reaching $30 billion dollars by 2020 gives New Zealand a strong incentive to move from volume driven to value driven export growth. There are exciting opportunities to grow our markets in new sectors, from digital media and e-commerce to engineering and manufacturing. Many innovative Kiwi firms are already blazing trails in this regard, with some impressive results.
There is also a need to think outside the box to grow our educational exports to China. For example, the tertiary sector can build on initiatives that already exist in tailoring instruction to suit Chinese students while exploiting niches where New Zealand has a competitive edge.
Tourism providers will need to respond to rapidly changing Chinese patterns in vacation styles, length and spending. They will need to fine tune the way they market New Zealand, both as a complete destination and as a supplement to holidays in Australia.
Investment
Investment is an area where a concerted push from both China and New Zealand will bring significant mutual benefit. Investment flows are just as important as trade flows, and should be seen by New Zealanders as no less desirable. New Zealand must adopt a more sophisticated approach to investing in China and recognise where participation in regional growth via investment provides greater value than investing locally.
Inward investment from China must be treated in a clear and non discriminatory fashion, no differently than any other potential overseas investment. The challenge here is one of popular attitudes, sometimes reflected in the views expressed by politicians and opinion-leaders. It is very likely that popular opposition will reduce over time, as Chinese investors prove to be good partners at least as much as any other overseas investor or even local investors.
Public awareness and language
It goes without saying that New Zealand would benefit from wider and deeper understanding of China among the population as a whole. Both in New Zealand and in China, misinformation and ill informed commentators have the potential to weaken the trust and goodwill that has been built up between our countries over time.
Fortunately, understanding of Chinese people and culture among New Zealanders has grown exponentially in recent years. The Lantern Festival is now one of the most popular events on Auckland’s cultural calendar. More New Zealanders are travelling to China as tourists and more Chinese are choosing New Zealand for their vacations.
Language acquisition is a primary means of becoming more familiar and comfortable with a foreign culture. The learning of Mandarin should therefore be seen not just as a means of improving business ties, but of increasing New Zealanders’ understanding of and comfort with Chinese cultures.
The recent move to allocate $10 million in funding for Asian language learning in primary schools is an important step and government should rightly be commended for this decision.
Looking to the future
There is every reason for us to look to the future with excitement and optimism. New Zealand’s relationship with China is already one of the best we have and with the visit of President Xi Jinping we can only expect it to strengthen and grow.
The challenge for New Zealand is to continue the work that underpins the China relationship – toward greater regional integration of trade and investment, greater goodwill and greater understanding between our peoples and cultures.
Leading up to President Xi’s visit, NZ China Council has briefed numerous news agencies both in NZ and offshore on the NZ and China relationship.
By Sir Don McKinnon, Chairman – New Zealand China Council.
The above letter was prepared for NZ Chinese Herald.
Nov 29, 2014