On Newshub Nation: Simon Shepherd Interviews former NZ Ambassador to China, John McKinnon

Simon Shepherd: Welcome back. Tension increased in the South China Sea this week after a Chinese naval ship reportedly rammed and sank a Vietnamese fishing boat. That’s one of the areas where New Zealand agrees to disagree with China over its foreign policy, and yet we need them. They are our largest export market. The Prime Minister says it’s a complex relationship and has yet to secure a long-promised visit to Beijing. So is the relationship on the rocks? Former Ambassador to China John McKinnon joins me now. Thanks for your time this morning.

John McKinnon: Thank you, Simon.

So how concerning is it that the Prime Minister can’t seem to secure this visit to Beijing?

I don’t think we should read too much into it. I spent a lot of my time– I was there from 2015 to 2018 scheduling visits. It’s fiendishly difficult, because you’re trying to line up diaries from important people in New Zealand and important people in China. And it will happen, and it’s important that it happens, because those high-level visits are very significant in terms of sending messages through the system about what we think of China and what China thinks of us.

So, I mean, you believe the excuse, as it were. It is a diary issue, but you’d like to see her go soon, then?

Well, I’d like to see her go, and I think she will go. I wouldn’t want to put ‘soon’ into a particular time frame. I’m sure it’ll happen, but the point about it is that when you have a high-level visit, it means that the system in China, and this will apply in most other countries, for that moment in time it focuses on New Zealand and right up to the highest level, and that is important. It’s important that our leaders have the opportunity to do that in China. They also, of course, have many opportunities to meet these leaders in other parts of the world, because they go to multilateral meetings and the like.

But the keynote, or the main event is actually going to the country, isn’t it?

Well, I think it’s important. It has a quality which you can’t transfer from some other meeting, but you know, there have been lots of contacts, but I certainly think she will be going, and it will, you know, hopefully be–

So, are we misreading the tea leaves, then? Is there really a breakdown in relations at the moment, or is it a storm in a teacup?

It’s a good metaphor for China – tea. I would say there are changes afoot in many different ways. There are changes in New Zealand; there are changes in China; there are changes in the world, and it’s making navigating a relationship with a country such as China more difficult and, to use the Prime Minister’s words, more complex. So there is another different environment, if you like, a different context. But I would hesitate to say– In fact, I wouldn’t say this is a relationship in trouble. I do think it requires a lot of management and a lot of communication and a lot of attention.

You talk about changes. Now, we’ve made changes here.

Yeah.

Like, we’ve had the Pacific Reset policy and the defence policy statement – both of those seemingly controversial.

Yeah.

Have they been the kind of changes that has upset China?

Well, I think there are always going to be areas where we say and do things where China will not necessarily agree with and vice versa. And the two big realities for us in China – it is a very large, now, trading economic partner for us. In fact, it’s probably our largest, I think, on latest figures, but also it’s a country with a very different history, a very different political and social system, and there are going to be moments when we basically take different views, and the items you just mentioned are part of that. They came up when I was in Beijing. They’re not, in that sense, new, but they are areas where we don’t see things the same way. And the challenge therefore is not to say, ‘Oh, well, we’re always going to agree.’ It’s how do you manage the points at which you take a different view.

So you say you were in Beijing when these issues came up.

Yeah.

So you were on the frontline, as it were, in terms of reaction.

Yes.

Can you describe to me what kind of reaction you did get from China?

Well, of course it’s a diplomatic reaction, but it–

By reading the tea leaves?

We had a lot of conversations about issues such as the South China Sea, because that was an area where China feels very sensitive about, we feel sensitive about because of the role we place on international law and the tribunals. So you have conversations, and you know that you’re going to say your side, and they’re going to say their side. And that’s helpful, because I think it’s important to understand, but you also probably know that you’re not going to reach an agreement.

Has China done some pushing back? And now, I’m referring to, sort of, Huawei just recently. I know they’re a private company, but they’ve taken out ads in New Zealand, criticising a decision by the GCSB. And also we’ve seen these articles in the Global Times saying maybe don’t travel to New Zealand. Is that a push back?

Well, I mean, there are a variety of opinions floating around. Well, Huawei, I think, one would have to infer from the extent of their advertising that they still feel that they’re in the game, and that would be in a technical sense very accurate. I mean, the decision hasn’t actually been made. It’s now in the hands of Spark as to what they should do with that. So Huawei may still see itself as being a contender there. I think with some of the other things, you just have to know and interpret different levels of commentary from China. And a lot of the time in Beijing we did spend, we did scrutinise quite closely, not just people like the Global Times or the People’s Day, but also what has happening in social media. And, you know, we would try to see what was the view of New Zealand in social media – was it altering. And by and large, it was very positive. So that was an important part and no doubt will continue to be an important part of what people - you know, my successors in the Beijing Embassy are doing. But I don’t read into those isolated comments, any particular new set about New Zealand. And lately, there have been some more interesting statements or statements from the Foreign Ministry which have been more, I think, encouraging and positive in terms of how they recognise that this is a significant relationship and they want to keep it going.

Why is it a significant relationship? I mean, we need them, but why do they need us?

Yeah, very good question. There are a couple of elements, I think, which are in play here. I mean, clearly, the asymmetries of size, you just can’t even begin to contemplate. But we stand as a country which is a developed country, but we’re not, obviously, a G20 economy; we’re not an OE, we’re not an EU member, so we have a relationship with China which is a little bit different from that of many other Western countries. And I think they value that. They know that New Zealand’s of interest to a lot of their citizens, and so that’s also important for them. And I just read about the report of the terrible accident that took place in the South Island, I think it was yesterday, which involved, you know, Chinese visitors. And that’s an awful thing to be happening for anybody, but, you know, it’s something that, because of the way that social media now operates, it’ll be well known throughout China very, very quickly.

Has our influence in the Pacific got anything to do with China’s, sort of, thinking that we’re important?

Well, I think that, you know, we have a role in the Pacific which is relating to us as New Zealand, regardless of what China thinks about it. China is now more present in the Pacific than it used to be, and that’s obviously been something that we need to be able to talk to China about. At the same time, we also need to be, obviously, keeping up our lines of communication with the Pacific governments. They are the ones who ultimately make those decisions. So it is part of it, but to me, the larger part of it is simply that New Zealand’s a country where they feel comfortable about the way they can live and do business here and that we respect their main concerns, if even if we don’t always agree with them.

Okay. Two quick things – David Parker, the Trade Minister, has been invited up to the Belt And Road conference in April, next month. What can we read into that?

Well, they had the first such conference in May 2017, when I was still in Beijing. This is the second, and they’re very keen to put this out as a part of China’s overarching strategy. So they will be inviting many people, and I think it’s good that David Parker has been invited and that he is going.

Okay. So, also, we’re renegotiating the FTA at the moment. So it’s a different situation from when we first signed in 2008. Is it at risk?

I don’t think it’s at risk. It is challenging. When we signed in 2008, that was the first free-trade agreement that China had signed with a developed country. And in a sense, it was path-breaking. But it was also highly relevant to New Zealand’s future economic interest. We’re in a situation now where China has many, many more FTAs. But also, in a sense, we did the things in 2008, and now we’re into the sort of stuff which is a little bit harder or things such as competition policy or E-commerce, which weren’t even really in the minds of the negotiations back in 2008. So I don’t think it’s a risk, but it’s going to be a long haul.

Okay. Just finally, last year you said in a speech, I believe, that the fundamental cultural differences between the two countries is that we are going to continue to be blindsided by certain events. What do you mean by that?

I think I said that, you know, we had to avoid being blindsided. But what I mean is that when New Zealand thinks about China, we have to recognise that it comes from a very different background and history from ours. I mean, one of the issues for China that they will constantly say, and with some justification, is that they have lifted more people out of poverty than any other country in history. And that is factually correct. We would say, ‘Yeah, but we have also got to think about individual rights – you know, whether it’s minorities or whether it’s Christians or other such groups.’ That’s where you need to be aware that whatever you think about, China is a very different place, and it’s going to react and act differently from what we might be thinking.

All right. John McKinnon, thank you very much.

Thank you very much indeed. Okay. Thank you.

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