The Cook Islands squabble
The recent squabble between the Cook Islands and NZ over their deal with China has added a new element of tension in the relationship between China and NZ.
It comes as NZ walks something of a tightrope in terms of international politics, trying to keep friends with traditional allies, but at the same time facing up to the fact that for the foreseeable future China will remain a major market for NZ's primary exports.
When news of the cyber attack broke, Foreign Minister Winston Peters described it as 'unacceptable', while Prime Minister Christopher Luxon noted it was the first time NZ had publicly called out China in this way. But unlike the UK and the US, NZ has decided not to impose any sanctions on China - a move which Jacobi believes is correct.
"Top marks for our people in this regard," says Stephen Jacobi.
He believes the NZ Government made a very careful and measured response to the Chinese, which states the need for us to uphold our values and protect our democratic institutions.
He adds that the Chinese won't like this and staff at the Chinese embassy in Wellington have denied their country's involvement in any cyber attack.
"In all of this, is there a risk to our trade?" asks Jacobi.
"Well, when bilateral relations are affected like this, of course there is some level of risk. But there is also a lot that is going very well in the relationship with China, so I hope the Chinese will take a measured view of this in respect of NZ."
He syas there has been a long standing relationship with China going back to the 1930s with, for instance, NZ-born writer and activst Rewi Alley who lived in China for most of his adult life. In recent times, there has been the signing of an FTA between the two countries and ongoing high level political visits aimed at strengthening the economic relationship. Jacobi believes the Chinese will not be completely surprised by NZ's reaction to the cyber attack - given they know that we are a democratic nation with close ties to our allies and cherish our democratic institutions. He says the Chinese will also be aware that NZ has a long history of operating an independent foreign policy.
"Not just signing on to someone else's press statement but working out what our values and interests are and making an appropriate response."
Jacobi wouldn't be surprised if there were talks behind the scenes before the formal statement was made by the NZ Government.
Strong Demand
While the Chinese market is taking time to emerge from the Covid lockdowns and subsequent internal economic problems, Jacobi believes there is still good demand for the high quality food products that NZ exports there.
He says there is still a lot of optimism in China and he expects that country to come back to growth mode.
“Remember who is buying our products in China – the middle class – and that market is continuing to grow and still has a lot of purchasing power,” he told Rural News. “They are looking for the sort of products that we produce and from a country that treats China respectfully – notwithstanding the present situation.”
Jacobi says NZ needs to look for further export options but says he’s not sure we can replace China any time soon in our export mix.
