tag:theconversation.com,2011:/ca-fr/topics/pacific-reset-54350/articlesPacific reset – La Conversation2020-06-07T19:48:45Ztag:theconversation.com,2011:article/1396612020-06-07T19:48:45Z2020-06-07T19:48:45ZSun, sand and uncertainty: the promise and peril of a Pacific tourism bubble<figure><img src="https://images.theconversation.com/files/339955/original/file-20200605-67383-1vgpgao.jpg?ixlib=rb-1.1.0&rect=21%2C0%2C6991%2C2228&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">www.shutterstock.com</span></span></figcaption></figure><p>Pacific nations have largely <a href="https://www.nzherald.co.nz/world/news/article.cfm?c_id=2&objectid=12328702">avoided</a> the worst health effects of COVID-19, but its economic impact has been devastating. With the tourism tap turned off, unemployment has soared while GDP has plummeted. </p>
<p>In recent weeks, Fiji Airways laid off 775 employees and souvenir business Jack’s of Fiji laid off 500. In Vanuatu 70% of tourism workers have lost their jobs. Cook Islands is estimated to have experienced a <a href="https://www.newsroom.co.nz/2020/05/18/1177034/an-island-in-debt">60% drop in GDP</a> in the past three months.</p>
<p>In response, many are calling for the Pacific to be included in the proposed <a href="https://www.stuff.co.nz/national/politics/121727144/coronavirus-transtasman-travel-bubble-date-down-to-australians-winston-peters-says">trans-Tasman travel corridor</a>. Such calls have come from <a href="https://devpolicy.org/vanuatu-a-tourism-sector-perspective-on-potential-recovery-from-covid-19-and-tc-harold-20200506-1/">tourism operators</a>, <a href="https://www.rnz.co.nz/international/pacific-news/418156/pressure-mounts-on-nz-and-aust-to-include-pacific-in-bubble">politicians</a> and at least one <a href="https://www.newsroom.co.nz/ideasroom/2020/05/28/1205479/nz-pacific-islands-bubble-should-come-first">health expert</a>.</p>
<p>Quarantine concerns aside, there is economic logic to this. Australians and New Zealanders make up <a href="http://pacific.scoop.co.nz/2019/06/tourism-sector-achieves-3-16-million-visitor-arrivals-in-18/">more than 50%</a> of travellers to the region. Some countries are massively dependent: two-thirds of visitors to Fiji and three-quarters of visitors to Cook Islands are Aussies and Kiwis. </p>
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<p>Cook Islands has budgeted NZ$140 million for economic recovery, but this will increase the tiny nation’s debt. Prime Minister Henry Puna has <a href="https://www.newshub.co.nz/home/travel/2020/06/cook-islands-prime-minister-calls-for-pacific-bubble-as-soon-as-new-zealand-enters-covid-19-alert-level-1.html">argued for</a> a limited tourism bubble as soon as New Zealand relaxes its COVID-19 restrictions to alert level 1. Cook Islands News editor Jonathan Milne <a href="https://player.whooshkaa.com/coronavirus-nz?episode=665993">estimates</a> 75-80% of the population is “desperate to get the tourists back”. </p>
<p>A Pacific bubble would undoubtedly help economic recovery. But this merely highlights how <a href="https://www.eco-business.com/opinion/impact-of-covid-19-on-tourism-in-small-island-developing-states/">vulnerable</a> these island economies have become. Tourism <a href="https://www.researchgate.net/publication/337854342_Development_and_change_Reflections_on_tourism_in_the_South_Pacific">accounts</a> for between 10% and 70% of GDP and up to one in four jobs across the South Pacific.</p>
<p>The pressure to reopen borders is understandable. But we argue that a tourism bubble cannot be looked at in isolation. It should be part of a broader strategy to diversify economies and enhance linkages (e.g. between agriculture and tourism, to put more local food on restaurant menus), especially in those countries that are most perilously dependent on tourism.</p>
<h2>Over-dependence on tourism is a trap</h2>
<p>Pacific nations such as Vanuatu and Fiji have recovered quickly from past crises such as the GFC, cyclones and coups because of the continuity of tourism. COVID-19 has turned that upside down.</p>
<p>People are coping in the short term by reviving subsistence farming, fishing and <a href="https://www.theguardian.com/world/2020/may/08/two-piglets-for-a-kayak-fiji-returns-to-barter-system-as-covid-19-hits-economy">bartering</a> for goods and services. Many are still suffering, however, due to limited state welfare systems.</p>
<p>In Fiji’s case, the government has taken the drastic step of allowing laid-off or temporarily unemployed workers to withdraw from their superannuation savings in the National Provident Fund. Retirement funds have also been used to <a href="https://www.fijivillage.com/news/We-need-Fiji-Airways-to-come-back-strongly-for-the-future-of-the-country---Koroi-48r5xf/">lend FJ$53.6 million</a> to the struggling national carrier, Fiji Airways.</p>
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<p>Fiji has taken on more debt to cope. Its debt-to-GDP ratio, which ideally should sit below 40% for developing economies, has risen from 48.9% before the pandemic to 60.9%. It’s likely to <a href="http://www.economy.gov.fj/images/Budget/budgetdocuments/supplements/SUPPLEMENT-TO-THE-COVID-19-RESPONSE-BUDGET-ADDRESS.pdf">increase further</a>.</p>
<p>High debt, lack of economic diversity and dependence on tourism put the Fijian economy in a very vulnerable position. Recovery will take a long time, probably requiring assistance from the country’s main trading partners. In the meantime, Fiji is pinning hopes on joining a New Zealand-Australia <a href="https://www.rnz.co.nz/international/pacific-news/416392/fiji-keen-to-join-nz-australia-travel-bubble">travel bubble</a>.</p>
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<span class="caption">Rarotonga International Airport: three-quarters of visitors are Aussies and Kiwis.</span>
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<h2>Out of crisis comes opportunity</h2>
<p>Supporting Pacific states to recover is an opportunity for New Zealand and Australia to put their respective Pacific <a href="https://www.mfat.govt.nz/en/about-us/mfat-annual-reports/mfat-annual-report-2018-19/case-study-the-pacific-reset-a-year-on/">Reset</a> and <a href="https://www.dfat.gov.au/geo/pacific/Pages/the-pacific">Step-Up</a> policies into practice. If building more reciprocal, equitable relationships with Pacific states is the goal, now is the time to ensure economic recovery also strengthens their socio-economic, environmental and political infrastructures.</p>
<p>Economic well-being within the Pacific region is already closely linked to New Zealand and Australia through seasonal workers in horticulture and viticulture, remittance payments, trade and travel. But for many years there has been a major trade imbalance in favour of New Zealand and Australia. Shifting that balance beyond the recovery phase will involve facilitating long-term resilience and sustainable development in the region. </p>
<p>A good place to start would be the recent United Nations Economic and Social Commission for Asia and the Pacific <a href="https://www.unescap.org/sites/default/files/Policy%20brief_MPFD_Combating%20COVID-19%20in%20Asia%20and%20the%20Pacific%20updated.pdf">report</a> on recovering from COVID-19. Its recommendations include such measures as implementing social protection programs, integrating climate action into plans to revive economies, and encouraging more socially and environmentally responsible businesses. </p>
<p>This is about more than altruism – enlightened self-interest should also drive the New Zealand and Australian agenda. Any longer-term economic downturn in the South Pacific, due in part to over-reliance on tourism, could lead to instability in the region. There is a clear <a href="https://www.weforum.org/agenda/2018/11/the-next-economic-crisis-could-cause-a-global-conflict-heres-why">link</a> between serious economic crises and social unrest. </p>
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<p>At a broader level, the pandemic is already <a href="https://asia.nikkei.com/Politics/International-relations/Coronavirus-gives-China-an-edge-as-it-expands-sway-in-the-Pacific">entrenching</a> Chinese regional influence: loans from China make up 62% of Tonga’s total foreign borrowing; for Vanuatu the figure is 43%; for Samoa 39%. </p>
<p>China is taking the initiative through what some call “<a href="https://devpolicy.org/chinas-coronavirus-covid-19-diplomacy-in-the-pacific-20200527-1/">COVID-19 diplomacy</a>”. This involves funding pandemic stimulus packages and offering aid and investment throughout the Pacific, including drafting a <a href="https://www.fbcnews.com.fj/news/free-trade-agreement-talks-underway-between-fiji-and-china/">free trade agreement</a> with Fiji. </p>
<p>That is not to say Chinese investment in Pacific economies won’t do good. Rather, it is an argument for thinking beyond the immediate benefits of a travel bubble. By realigning their development priorities, Australia and New Zealand can help the Pacific build a better, more sustainable future.</p><img src="https://counter.theconversation.com/content/139661/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>The authors do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Pressure is growing to include struggling Pacific nations in an Australia-New Zealand travel bubble, but economic diversity is what the region really needs.Regina Scheyvens, Professor of Development Studies, Massey UniversityApisalome Movono, Senior Lecturer in Development Studies, Massey UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1119092019-02-20T05:27:42Z2019-02-20T05:27:42ZHuawei or the highway? The rising costs of New Zealand’s relationship with China<figure><img src="https://images.theconversation.com/files/259676/original/file-20190219-129545-fuc4q0.jpg?ixlib=rb-1.1.0&rect=131%2C131%2C4468%2C2578&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">New Zealand's Prime Minister Jacinda Ardern meeting with the Premier of the State Council of the People's Republic of China Li Keqiang during last year's ASEAN summit.</span> <span class="attribution"><span class="source">AAP Image/Mick Tsikas</span>, <a class="license" href="http://creativecommons.org/licenses/by-nd/4.0/">CC BY-ND</a></span></figcaption></figure><p>Until recently, New Zealand’s relationship with China has been easy and at little cost to Wellington. But those days are probably over. New Zealand’s <a href="https://www.radionz.co.nz/news/national/377136/huawei-5g-decision-everything-you-need-to-know">decision to block Huawei from its 5G cellular networks due to security concerns</a> is the first in what could be many hard choices New Zealand will need to make that challenge Wellington’s relationship with Beijing.</p>
<p>For over a decade New Zealand has reaped the benefits of a <a href="https://www.mfat.govt.nz/en/trade/free-trade-agreements/free-trade-agreements-in-force/china-fta/nz-china-fta-resources">free-trade agreement with China</a> and seen a boom of Chinese tourists. China is <a href="https://nzchinacouncil.org.nz/2019/02/new-zealands-exports-to-china-trump-sales-to-australia-and-the-united-states/">New Zealand’s largest export destination</a> and, apart from concerns about the influence of Chinese capital on the housing market, there have been few negatives for New Zealand. </p>
<p>Long-held fears that New Zealand would eventually have to “choose” between Chinese economic opportunities and American military security had not eventuated. </p>
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<a href="https://theconversation.com/new-zealands-pacific-reset-strategic-anxieties-about-rising-china-97174">New Zealand's Pacific reset: strategic anxieties about rising China</a>
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<p>But now New Zealand <a href="https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12203882">business people in China</a> have warned of souring relations and the <a href="https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12204147">tourism industry is worried about a downturn</a> due to backlash following the <a href="https://www.forbes.com/sites/zakdoffman/2019/02/17/huawei-backlash-china-accuses-lying-u-s-of-unjust-and-immoral-bullying/#4a1ad9cb6963">Huawei controversy</a>. </p>
<h2>China’s growing might</h2>
<p>During Labour’s government under Helen Clark (1999-2008) and under the National government with John Key as prime minister (2008-2016), New Zealand could be all things to all people, <a href="http://www.chinadaily.com.cn/china/2016-04/20/content_24678849.htm">building closer relationships with China</a> while finally <a href="https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=11147936">calming the last of the lingering American resentment over New Zealand’s anti-nuclear policies</a>. But now, there are difficult decisions to be made. </p>
<p>As China becomes more assertive on the world stage, it is becoming increasingly difficult for New Zealand to keep up this balancing act. Two forces are pushing a more demanding line from Beijing. One is China’s move to <a href="https://amti.csis.org/chinas-reach-grown-island-chains/">assert more control over waters well off its coast</a>. </p>
<p>For decades, Beijing was happy to let the US Navy maintain order over the Western Pacific to facilitate global trade with China. As China’s own <a href="https://media.defense.gov/2018/Aug/16/2001955282/-1/-1/1/2018-CHINA-MILITARY-POWER-REPORT.PDF">economic and military abilities have grown</a>, it has begun to show that it is willing to protect what it sees as its own patch. Its <a href="https://thediplomat.com/2018/07/chinas-island-build-up-the-view-from-space/">mammoth island building in the South China Sea</a> is a testament to its new-found desire to push its territorial claims after decades of patience. </p>
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<a href="https://theconversation.com/despite-strong-words-the-us-has-few-options-left-to-reverse-chinas-gains-in-the-south-china-sea-97089">Despite strong words, the US has few options left to reverse China's gains in the South China Sea</a>
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<p>China’s stronger foreign policy is <a href="https://www.lowyinstitute.org/the-interpreter/does-china-rise-threaten-rules-based-order">testing what is known as the “rules-based order”</a>, essentially a set of agreed rules that facilitate diplomacy, global trade, and resolve disputes between nations. This is very concerning for New Zealand as it needs stable rules to allow it to trade with the world. New Zealand doesn’t have the size to bully other countries into getting what we want. </p>
<p>Trump-style posturing would get New Zealand nowhere. A more powerful China doesn’t need to threaten the rules-based system, but the transition could create uncertainty for business and higher risks of trade disruption. It is vital for New Zealand that an Asia-Pacific dominated by China is as orderly as one dominated by the US.</p>
<h2>Tech made in China</h2>
<p>The other force challenging the relationship is <a href="https://www.scmp.com/tech/big-tech/article/2186494/how-huawei-went-small-time-trader-shenzhen-worlds-biggest-telecoms">China’s emergence as a source of technology</a> rather than simply a manufacturer of other countries’ goods. Many Chinese firms like Huawei are now <a href="https://www.telegraph.co.uk/technology/2018/09/23/chinas-tech-giants-have-conquered-east-now-west/">direct competitors of Western tech companies</a>. Huawei’s success makes it strategically important for Beijing and a point of pride for ordinary Chinese citizens. </p>
<p>Yet, unlike Western countries, <a href="http://www.ndrc.gov.cn/zcfb/zcfbtz/201505/t20150513_691578.html">China actively monitors its population</a> through a wide variety of mass surveillance technology. Therefore, there is a trust problem when Chinese firms claim that their devices are secure from Beijing’s spies. New Zealand’s <a href="https://www.radionz.co.nz/news/national/377136/huawei-5g-decision-everything-you-need-to-know">decision to effectively ban Huawei components</a> from 5G cellular networks could be the first in many decisions needed to ensure national security.</p>
<p>Chinese designed goods are becoming more common and issues around privacy and national security will get stronger as <a href="https://www.engadget.com/2017/01/04/griffin-connects-your-toast-to-your-phone/">everyday household goods become connected to the internet</a>. Restrictions on Chinese-made goods will further frustrate Beijing and will invite greater retaliation to New Zealand exporters and tourist operators. </p>
<p>In more extreme cases, foreign nationals have been detained in China in response to overseas arrests of prominent Chinese individuals. As many as <a href="https://www.theglobeandmail.com/politics/article-thirteen-canadians-detained-in-china-since-huawei-executives-arrest/">13 Canadians were detained recently</a> in China following the arrest of Huawei’s CFO Meng Wanzhou in Vancouver at the request of US prosecutors.</p>
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Read more:
<a href="https://theconversation.com/australian-chinese-authors-detention-raises-important-questions-about-chinas-motivations-110433">Australian-Chinese author's detention raises important questions about China's motivations</a>
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<h2>Declaring the limits of the relationship</h2>
<p>If New Zealand is to maintain a healthy relationship with China, it needs to be clear on what it is not willing to accept. It is easy to say individual privacy, national security and freedom of speech are vital interests of New Zealand, but Wellington needs to be clear to its citizens and to China what exactly those concepts mean in detail. All relationships require compromise, so Wellington needs to be direct about what it won’t compromise.</p>
<p>New Zealand spent decades during the Cold War debating how much public criticism of the US the government could allow itself before it <a href="https://www.jstor.org/stable/2608985">risked its alliance with the Americans</a>. New Zealanders wondered if they really had an <a href="http://www.press.auckland.ac.nz/en/browse-books/all-books/books-1993/Independence-and-Foreign-Policy-New-Zealand-in-the-World-Since-1935.html">independent foreign policy if they couldn’t stand up to their friends</a>. Eventually nationalist sentiment spilled over in the form of the anti-nuclear policy.</p>
<p>New Zealand is now heading for the same debate as Kiwis worry about how much they can push back against Beijing’s interests before it starts to hurt the economy. Now that the relationship with China is beginning to have significant costs as well as benefits, it’s probably time New Zealanders figured out how much they are prepared to pay for an easy trading relationship with China.</p><img src="https://counter.theconversation.com/content/111909/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>David Belgrave is a member of Auckland branch of the New Zealand Institute of International Affairs. </span></em></p>New Zealand’s decision to block Huawei from its 5G cellular networks due to security concerns is likely to be just the first of many that challenge Wellington’s relationship with Beijing.David Belgrave, Lecturer in Politics and Citizenship, Massey UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1004542018-08-26T21:38:58Z2018-08-26T21:38:58ZHere’s how to reset New Zealand’s cultural diplomacy in the Pacific<figure><img src="https://images.theconversation.com/files/233188/original/file-20180822-149466-9n2wvq.jpg?ixlib=rb-1.1.0&rect=613%2C404%2C4378%2C4244&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">New Zealand proposes a new approach to diplomacy with its Pacific neighbours.</span> <span class="attribution"><span class="source">from www.shutterstock.com</span>, <a class="license" href="http://creativecommons.org/licenses/by-sa/4.0/">CC BY-SA</a></span></figcaption></figure><p>As part of a <a href="https://www.stuff.co.nz/national/politics/103738729/budget-2018-1b-for-foreign-affairs-massive-boost-to-pacific-aid-and-a-new-embassy">renewed approach to diplomacy in the Pacific region</a>, the New Zealand budget this year included a funding boost for the <a href="https://www.mfat.govt.nz/en/aid-and-development/our-work-in-the-pacific/">Ministry of Foreign Affairs and Trade (MFAT)</a> - NZ$150 million additional operational spending over four years - and a 30% increase in funding for New Zealand’s aid programme.</p>
<p>The question now is how to spend the money to achieve a real change in the way New Zealand engages with the Pacific. Asking all New Zealand diplomats to serve time in the Pacific would be a good start.</p>
<h2>Increasing New Zealand influence</h2>
<p>The <a href="https://www.mfat.govt.nz/assets/Uploads/Redacted-Pacific-Cabinet-Paper-2018-for-public-release.pdf">cabinet paper</a> setting out New Zealand’s refreshed approach to the Pacific notes a “dizzying array of problems in the region … and an increasingly contested strategic environment”, eroding New Zealand’s influence. </p>
<p>It proposes a new approach that includes “developing deeper partnerships” and bolstering the influence of like-minded partners. </p>
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<a href="https://theconversation.com/new-zealands-pacific-reset-strategic-anxieties-about-rising-china-97174">New Zealand's Pacific reset: strategic anxieties about rising China</a>
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<p>MFAT’s extra funding will allow it to employ 50 more diplomats. But to shift New Zealand’s engagement with the Pacific region, two important changes are needed. </p>
<p>Firstly, all New Zealand diplomats should be required to serve in the region at least once. Too few have spent time in the Pacific. Of the 11 members of MFAT’s leadership team, only one has served there. A three-year stint living in the Pacific is a powerful way to make friends and influence people. </p>
<p>Secondly, the reset needs to be far broader. New Zealand needs to recognise that the Pacific doesn’t just mean Polynesia - New Zealand’s interests in Melanesia are important and growing. New Zealand ministers need to carry through on the promise made in the <a href="https://www.stuff.co.nz/national/politics/opinion/106227005/new-zealands-pacific-reset-the-case-for-cultural-diplomacy">reset announcement</a> of frequent visits and a “high degree of political access” for Pacific leaders who visit New Zealand. </p>
<h2>Don’t forget cultural diplomacy</h2>
<p>The cabinet paper also notes the reset will place a greater focus on soft diplomacy, public diplomacy and people-to-people measures, all aimed at increasing New Zealand’s influence and connections. However, neither soft diplomacy nor public diplomacy are defined. </p>
<p>Soft diplomacy takes its name from soft power - the ability of a country to persuade others to do what it wants without force or coercion. Several <a href="https://www.sciencedirect.com/science/article/abs/pii/S0363811113001975">definitions of public diplomacy</a> have emerged recently, and the concept has been shifting from one-way transmission to collaboration. </p>
<p>The cabinet paper does not make it clear which tools the New Zealand government intends to use to reset its objectives in the Pacific region. The focus on New Zealand influence, using an approach distinguished by friendship and mutual benefit, suggests a prominent role for cultural diplomacy - the deployment of a state’s culture in support of its foreign policy goals. </p>
<p>Cultural diplomacy has the power to connect people from different cultures. Activities include language training, cultural performances, sport, scholarships and visits. The practice comes in two types. </p>
<p>Cultural branding focuses on promoting a positive aspect of a country in order to advance its interests. This has little genuine collaboration and the aim is mostly transmission. The second, far less prevalent type of cultural diplomacy is less concerned with showing off and more about advancing joint interests and empowering local voices and viewpoints. </p>
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Read more:
<a href="https://theconversation.com/why-chinas-debt-book-diplomacy-in-the-pacific-shouldnt-ring-alarm-bells-just-yet-96709">Why China's 'debt-book diplomacy' in the Pacific shouldn't ring alarm bells just yet</a>
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<h2>Expanding New Zealand’s cultural diplomacy</h2>
<p>New Zealand is well-placed to use cultural diplomacy. For one, it is a Pacific nation. A significant percentage of its population has Pacific ancestry and the <a href="https://ethniccommunities.govt.nz/sites/default/files/files/EthnicityDataOnlineDemographicOverview.pdf">domestic links to the region are substantial</a>. </p>
<p>MFAT’s current range of activities includes <a href="https://www.mfat.govt.nz/en/aid-and-development/">scholarships through the New Zealand aid programme</a> (NZAP), cultural and educational connections and a noticeable focus on sport. Immediate gains could be made by increased funding for scholarships and academic or students exchanges.</p>
<p>Scholarships are the gold standard of collaborative, shared-interest cultural diplomacy. For partners in the Pacific, NZAP scholarships provide an opportunity to study at tertiary education institutions that may not be available in their country, in subjects that are essential to the future wellbeing of Pacific states. For New Zealand, a cadre of scholarship recipients also get to know New Zealand. Similarly, academic and student exchanges, in both directions, are a powerful way to connect. </p>
<p>Another step could be increased support for cultural institutions. New Zealand provided substantial funding to replace the Huanaki Cultural Centre in Niue after it was destroyed by Cylcone Heta in 2004, but many other museums, galleries and libraries are also in need of support. </p>
<p>The <a href="https://www.facebook.com/Vanuatu-Cultural-Centre-102854059751957/">Vanuatu Cultural Centre</a> is a model, particularly its network of volunteer field workers throughout the country. The <a href="https://www.beehive.govt.nz/release/minister-launch-bougainville-library-project">Bougainville library project</a> is another example of collaboration, bringing together a New Zealand trust, a Bougainville trust, and <a href="https://vsa.org.nz/">Volunteer Services Abroad</a> (VSA) volunteers. Yet, at the time funding was being raised for the project, the New Zealand government did not contribute a cent. </p>
<p>The Pacific barely features in the government’s only dedicated <a href="https://mch.govt.nz/what-we-do/cultural-diplomacy-international-programme">cultural diplomacy fund</a>. The NZ$2 million <a href="https://mch.govt.nz/what-we-do/cultural-diplomacy-international-programme">Cultural Diplomacy International Programme</a>is aimed at boosting New Zealand’s profile and its economic, trade, tourism, diplomatic and cultural interests. It ostensibly has a focus on the Asia-Pacific region, but in practice the program is primarily concerned only with Asia. </p>
<p>Just <a href="https://mch.govt.nz/what-we-do/cultural-diplomacy-international-programme/cdip-projects">one event</a> has taken place in the Pacific since 2009. The fund seems concerned with cultural branding rather than collaboration, but that would be easy to adjust.</p><img src="https://counter.theconversation.com/content/100454/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Simon Mark is currently the president of Volunteer Service Abroad</span></em></p>Whether New Zealand achieves real change in the way it engages with Pacific nations depends on how the ‘Pacific reset’ funding boost is translated into action on the ground.Simon Mark, Senior Adviser Strategy and Policy, Massey UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/971742018-06-01T02:11:09Z2018-06-01T02:11:09ZNew Zealand’s Pacific reset: strategic anxieties about rising China<figure><img src="https://images.theconversation.com/files/220873/original/file-20180529-80633-82w0rq.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">As China is extending its influence in the South Pacific, New Zealand has responded with increased aid for the region.</span> <span class="attribution"><span class="source">from www.shutterstock.com</span>, <a class="license" href="http://creativecommons.org/licenses/by-sa/4.0/">CC BY-SA</a></span></figcaption></figure><p>China’s expanding influence is complicating strategic calculations throughout the Asia-Pacific region. </p>
<p>Small states, dependent on maintaining high levels of trade with China to secure their prosperity, are loathe to criticise or take actions that Beijing could find objectionable. This is creating a dilemma over how small states can protect their national interests at a time when China’s growing influence threatens the status quo. </p>
<p>New Zealand illustrates this dynamic. It watches China extend its influence into the microstates of the South Pacific, a region where New Zealand (and its ally Australia) have long enjoyed a position of prominent influence.</p>
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Read more:
<a href="https://theconversation.com/why-chinas-debt-book-diplomacy-in-the-pacific-shouldnt-ring-alarm-bells-just-yet-96709">Why China's 'debt-book diplomacy' in the Pacific shouldn't ring alarm bells just yet</a>
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<h2>New Zealand’s Pacific reset</h2>
<p>The South Pacific is a geographic region encompassing 16 independent nations (and a number of associate nations and dependencies). The majority of these are microstates that face an array of economic, social and governance challenges and are vulnerable to natural disasters. </p>
<p>The two largest and most prosperous states by a fair margin are Australia and New Zealand. Historically, they have been the most dominant and influential players in the South Pacific. </p>
<p>Earlier this month, New Zealand’s minister of foreign affairs and trade, <a href="https://www.beehive.govt.nz/minister/rt-hon-winston-peters">Winston Peters</a>, announced his government would <a href="https://www.radionz.co.nz/news/political/356903/714m-to-be-pumped-into-govt-s-pacific-reset-plan">spend an additional NZ$714 million over four years on international aid</a>, with the majority going to South Pacific nations. Peters explained that New Zealand’s interests in the region stem from its common Pacific identity, the desire to forge a path of shared prosperity and to uphold New Zealand’s national security that, he added, “is directly affected by the Pacific’s stability.”</p>
<p>Peter’s announcement of increased funding added substance to a <a href="https://www.lowyinstitute.org/publications/winston-peters-new-zealand-pacific">speech</a> he delivered to the <a href="https://www.lowyinstitute.org/">Lowy Institute</a> in Sydney in early March where he committed New Zealand to “shifting the dial” on its foreign policy approach towards the South Pacific. What went unstated – but was made unmistakably clear in Peter’s speech – was the increased role China is playing in the South Pacific and how this is “changing New Zealand’s relative influence”. </p>
<h2>Rising China, growing anxieties</h2>
<p>Long overdue, the New Zealand government’s renewed push is a soft-power response to a mounting dilemma that small states face in the Asia-Pacific region. In essence, as China’s power grows, it is leading Beijing to extend its influence into virtually every corner of the wider Asia-Pacific region. In the South Pacific, this influence is being secured through <a href="https://www.lowyinstitute.org/the-interpreter/bad-and-good-china-aid-pacific">aid</a>, loans (<a href="https://pcf.org.nz/news/2018-03-05/pacific-nations-drowning-in-chinese-debt">creating debt</a> South Pacific states may be unable to pay off) and <a href="https://www.newsroom.co.nz/2017/05/15/23681/chinese-money-is-changing-the-face-of-the-south-pacific">building projects</a>. </p>
<p>For a region comprised of fragile economies, China’s aid and loans can help bolster economic prospects. Yet, at the same time, China’s engagement is not selfless. A number of <a href="https://www.victoria.ac.nz/chinaresearchcentre/programmes-and-projects/china-symposiums/china-and-the-pacific-the-view-from-oceania/10-Yu-Changsen-The-Pacific-Islands-in-Chinese-Geo-strategic-Thinking.pdf">strategic interests drive it</a>. As China builds out its <a href="https://thediplomat.com/2016/04/going-blue-the-transformation-of-chinas-navy/">blue-water naval capabilities</a>, there are concerns that it may seek a military foothold in the region. </p>
<p>In March, reporting in Australia cited unnamed sources claiming that China was seeking an access agreement to dock its <a href="https://www.cnbc.com/2018/04/09/china-is-reportedly-proposing-a-military-base-in-the-south-pacific.html">naval ships in Vanuatu</a> in lieu of establishing a permanent military presence. Both <a href="https://www.theguardian.com/world/2018/apr/10/concerns-china-in-talks-with-vanuatu-about-south-pacific-military-base">China</a> and <a href="https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12029582">Vanuatu</a> denied this claim. True or not, reporting such as this taps into a heightened level of strategic anxiety New Zealand and Australian officials are experiencing.</p>
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Read more:
<a href="https://theconversation.com/response-to-rumours-of-a-chinese-military-base-in-vanuatu-speaks-volumes-about-australian-foreign-policy-94813">Response to rumours of a Chinese military base in Vanuatu speaks volumes about Australian foreign policy</a>
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<p>Given China’s ongoing <a href="https://www.theguardian.com/world/2018/feb/06/photos-beijings-militarisation-south-china-sea-philippines">militarisation of the South China Sea</a> and Beijing’s rejection of the <a href="https://www.theguardian.com/world/2016/jul/12/philippines-wins-south-china-sea-case-against-china">Hague Arbitral Tribunal’s ruling</a> in July 2016 against China’s expansive nine-dash-line territorial claims, New Zealand officials could be forgiven for raising questions over China’s long-term intentions in the South Pacific. </p>
<h2>Dilemma facing New Zealand</h2>
<p>The New Zealand government does not seek to exclude China from the South Pacific. In fact, it has looked to collaborate with Beijing where it can. The <a href="https://www.victoria.ac.nz/chinaresearchcentre/programmes-and-projects/china-symposiums/china-and-the-pacific-the-view-from-oceania/27-Pete-Zwart-The-Tripartite-China,-NZ,-Cook-Islands-A-NZ-Perspective.pdf">Tripartite Cook Islands/China/New Zealand Water Project </a>is an example of this, but the reset is clear evidence of Wellington’s desire to secure a role in the region as Beijing increases its influence. Yet, at this stage, New Zealand’s decision makers are acting as if there is very little they can do beyond responding with soft power in the form of increased aid and appeals to a common identity. </p>
<p>Ultimately, the constraints facing small states like New Zealand stem from their structural position relative to China, defined by an immense discrepancy in material resources. In short, China is an economic behemoth that, except for the United States, dwarfs every other country in the Asia-Pacific region. </p>
<p>While China is extremely important to the continued economic growth of small states in the Asia-Pacific, for Beijing these small states are relatively insignificant to its own economic fortunes. This gives China a potent lever to influence, compel and coerce states that draw its ire. </p>
<p>Larger economies such as the US and Japan have more room to manoeuvre vis-à-vis China’s increasing influence. Small states like New Zealand are walking a tight rope, lest they adopt positions Beijing finds regrettable and reduces or interferes with its trade. </p>
<p>For example, in 2010, Beijing <a href="https://www.reuters.com/article/us-norway-china/norway-china-normalize-ties-after-nobel-peace-prize-row-idUSKBN1480R4">froze political ties with Norway</a> for awarding Chinese dissident Liu Xiaobo the Nobel Peace Prize. Negotiations over a free trade deal restarted only in 2016. South Korean companies were punished when their government agreed to <a href="http://money.cnn.com/2017/08/30/news/economy/china-hyundai-south-korea-thaad/index.html">purchase US missile defence systems</a>. </p>
<h2>What now for New Zealand?</h2>
<p>Recognising New Zealand’s structural position is not to suggest it is powerless in the face of China’s expanding influence in the South Pacific. However, it is all but certain that China’s regional influence will continue to grow at the expense of the influence New Zealand and Australia hold. Decisions will need to be made as to how New Zealand calibrates its foreign policy with this in mind.</p>
<p>One option would be to consider how great New Zealand’s dependence on China truly is. How resilient would New Zealand’s economy be if trade with China were to decrease? According to <a href="https://s3.amazonaws.com/s3.documentcloud.org/documents/2299221/ey-oe-china-new-zealand-report-20150-may-2015.pdf">one report</a>, New Zealand’s economy would be vulnerable but more resilient than others in the region. </p>
<p>Ultimately, balancing China in the South Pacific will require greater coordination with Australia – still the Pacific’s largest donor – and reaching out to other states. Japan, South Korea and the US share concerns about China chipping away at their relative influence. However, Beijing could interpret increased collaboration with larger powers as a sign of regional containment of its growing influence. New Zealand could find itself punished in such a scenario, but running that risk may eventually become unavoidable.</p><img src="https://counter.theconversation.com/content/97174/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Reuben Steff does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>New Zealand’s foreign minister announced a NZ$714 million increase in aid for Pacific nations in a soft-power response to China’s growing influence in the Asia-Pacific region.Reuben Steff, Lecturer in International Relations and Security Studies, University of WaikatoLicensed as Creative Commons – attribution, no derivatives.