Between the U.S. and China: A Kiwi Perspective

By Matthew Hill, Intern, Global Issues Program at the Lowy Institute for International Policy

Recently, both Michael Green and Hugh White addressed the strategic challenges Washington and its partners face in adjusting to the shifting distribution of power in the Asia-Pacific.[1] Australia, Japan, and South Korea all show concern for the increasing friction between allegiance to a U.S.-centered security order, and economic imperatives that are increasingly focused on Shanghai, rather than New York. In contrasts, New Zealand has seen sustained improvement in its relationships with both the U.S. and the PRC, and indeed, has come to perceive these relationships as complementary. What explains this disparity in reactions, and what lessons does it hold for policymakers torn in the face of potential change in the regional hierarchy?

One response is to interpret New Zealand’s attempt to ‘square the circle’ between Washington and Beijing as a cautionary tale in geo-economic naivety. Such was the judgment of Professor David Shambaugh during his recent visit to New Zealand, in which he criticized Wellington’s lack of strategic awareness in expanding its engagement with the PRC. Similar assessments can be heard in Canberra’s policy circles, a sub-species of the perennial gripe that New Zealand lacks the realist perspective of a closer proximity to a rising Asia. This view insinuates that distance and isolation have bred complacency. When the chips are down, Wellington will realize that security and stability can only be guaranteed through Washington’s continued military primacy in the Asia-Pacific.

However, there is a more charitable assessment. Fundamental shifts in New Zealand’s foreign policy at the end of the Cold War – in particular, expulsion from ANZUS – forced it to abandon a worldview shaped by a special relationship to U.S. hegemony. Instead, Wellington reconceived its international engagement around attempts to advance a multilateral consensus that secures its basic security and economic interests, complemented by bilateral bonds in areas of shared interest with key partners such as Australia. Rather than tying its perceptions of global interests to a specific distribution of power, New Zealand has for the last two decades been positioning to adapt to dynamic change in the Asia-Pacific strategic order.

As part of this process, New Zealand has extended engagement with Asia, particularly with China. New Zealand is at the vanguard of economic engagement with the PRC, characterized by the ‘four firsts’ of approving China’s ascension to the WTO, granting it ‘market economy’ status,  and commencing and completing free trade negotiations with Beijing. Economic ties have boomed, to 12% of New Zealand’s trade in 2009, with China now Wellington’s second largest trading partner. Non-economic engagement, while more tentative, has also grown in areas of education, environmental protection, and socio-cultural ties.

This has not obscured kiwi concerns about China’s political and strategic trajectory. Beijing’s increasing involvement in the South Pacific has touched directly on New Zealand’s core geostrategic interests; diplomatic competition between the PRC and Taiwan has impacted on the internal political coherence of Melanesia. Looking north, Wellington remains apprehensive that Beijing is deploying its newfound power to exploit divisions in multilateral groupings, particularly as it seeks to advance bilateral over collective negotiations with ASEAN states over the South China Sea.

The positive and negative aspects of New Zealand’s relationship with China have complemented the re-invigoration of ties with Washington. While Wellington is realistic about the significant pressures on U.S. primacy, in its choices it instinctively mirrors Hugh White’s judgment that:

“Asia’s major powers are much more likely to build stable and peaceful relationships if the U.S. is present to lend its weight to a shared regional leadership.”

With this strategic concern in mind, cooperation between the U.S. and New Zealand has expanded significantly off the basis of significant common interests and values. The U.S. has lent its weight and shown appreciation for New Zealand and Australia’s engagement in the South Pacific, benefiting efforts to bolster regional stability and cohesion in the wake of the 2006 Fijian Coup. Conversely, Washington’s willingness to sign on to the Trans-Pacific Partnership and ASEAN’s Treaty of Amity and Cooperation has been greeted warmly in antipodes.

The manner in which New Zealand has framed it relations with the U.S. and China suggest three lessons for Asia-Pacific policymakers seeking to adapt to dynamic change in the region.

Firstly, U.S. allies such as Australia, Japan, and South Korea should attempt to disassociate perceptions of national interest and the formulation of grand strategy from the post-war framework upon which it had previously relied. This is not to suggest that Asia-Pacific states should seek to sever relations with Washington. Rather, cooperation should be expanded according to shared values and interests. Nonetheless, U.S. allies will benefit from recognizing the contradictions of basing expectations on Washington’s future regional role and a historical understanding of U.S. primacy that is likely to prove unsustainable.

Secondly, in pursuing multilateralism, New Zealand policymakers must remain anchored to a pragmatic appreciation of the distribution of power, interests and values. The rising power of Asian states with different interests and values will alter the agenda of multilateralism relative to that under Western leadership. At the same time, small states will have very little ability to sway an agenda that is significantly determined by compromises between major powers. The implication is that Wellington will have to adjust to a less normative, moralistic foreign policy.

Thirdly, U.S. policymakers need be wary of the long-term choices changing power dynamics force on smaller partners. Washington’s regional presence can best be bolstered through increased multilateral engagement, particularly with regards to trade negotiations. Expanding collective engagement will also provide opportunities for Washington to shore up bilateral bonds with regional partners, as demonstrated by recent improvements in the U.S.-New Zealand relationship.

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[1] See Michael J. Green, ‘America’s Grand Strategy in Asia: What Would Mahan Do?’ Lowy Institute Strategic Snapshots, no.2 (September 2010); Hugh White, ‘Power Shift: Australia’s Future Between Washington and Beijing,’ Quarterly Essay, no.39 (September 2010).