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The Kiwi and the Red Dragon: Does New Zealand play it safe in matters concerning China?

kiwifruits stacked
Source: Unsplash

Sameera Pillai

The relationship between New Zealand and China has recently been placed under the spotlight, after New Zealand refrained from confronting China over its egregious treatment of its Uyghur population. This might lead us to ask questions about New Zealand’s international loyalties and image, especially as a country whose government is touted for its progressivism. Are economic concerns and trade deals being prioritised over the Ardern Government’s progressive political values? What does New Zealand have to gain or lose from its relationship with China?

Bilateral Trade Relations

In 2008, New Zealand and China entered into a free trade agreement which has effectively fostered a cooperative environment between the two countries. In January 2021, the agreement was upgraded, making New Zealand exports more accessible to China, simplifying administrational processes around trade, and permitting tariff-free exports of wood and paper from New Zealand to China.

As of last year, New Zealand’s exports to Mainland China were valued at nearly 19 billion dollars, with its dairy products being the most sought-after commodity among Chinese consumers. As the world’s second largest economy, China is an active trading partner for many countries, and its prolific economic and political presence in the Indo-Pacific has positioned the country as New Zealand’s largest trading partner. China and New Zealand’s two-way trade includes New Zealand exports such as meat, wool and dairy products, and Chinese imports like electronics, machinery and clothing. With the ubiquitous nature of the goods moving between the countries, New Zealand and China’s bilateral trade is prolific. This two-way trade exceeds NZD 33 billion, and China currently accounts for 30 per cent of New Zealand’s exports.

This positive bilateral relationship is particularly interesting when juxtaposed with Sino-Australia trade relations, which have suffered a historic downturn. In 2020, Australian exporters were met with a deluge of trade sanctions, with heavy tariffs being placed on many commodities including barley, wine, meat and seafood. Beijing has cited “wine dumping” as one of the key reasons for boycotting goods and implementing trade sanctions.

However, considering that the trade tariffs were introduced shortly after Australia’s push for an independent investigation into the origins and spread of the COVID-19 virus, it is logical to perceive the influx in tariffs as retaliation for the investigation. The trade war is now seen as China’s response to these probes, especially following the Chinese ambassador’s explicit “threats of economic coercion” towards Australia.

WHO Report on COVID-19

The World Health Organization (WHO) report on the investigation of COVID-19’s origins was criticised by countries, including Australia, the United States, Britain and Canada, for lacking the necessary access to complete information and being long overdue at the time of publication. The WHO’s director-general claimed that investigators who travelled to China were met with challenges in accessing data to complete the comprehensive analysis into the origins of the virus. Some of the countries that voiced their concern are New Zealand’s allies, notably all other members of the Five Eyes Intelligence alliance, and yet New Zealand remained noticeably absent from the dialogue.

Justifying their silence, Ardern’s Government stated that they did not wish to make a comment until they had a complete understanding of the situation. Every state is aware of the economic consequences they could face in challenging an emerging superpower and economic powerhouse such as China. This shared awareness explains the Ardern Government’s non-confrontational stance. Considering the potential adverse economic repercussions that New Zealand could face in taking a critical position towards China, their relative silence on this issue is not surprising.

When New Zealand eventually agreed to join the international investigation into the origins of the coronavirus, the government made it clear that it did so to facilitate “learning” and not to “lay blame”. New Zealand’s participation as a third party in the World Trade Organization’s dispute settlement over the Sino-Australia trade conflict only reiterates its largely neutral stance towards China as the superpower becomes an increasingly assertive actor in the region.

Five Eyes on Human Rights Violations

Five Eyes is an intelligence alliance between the US, Canada, the UK, Australia and New Zealand, and is designed to facilitate information sharing between its member states at the highest level. Last year, its role expanded from the security and intelligence sphere to a more political function, accommodating dialogue about democracy and human rights. For New Zealand, this was not a welcome change, and the country regarded the widening of Five Eyes’ scope with disfavour, instead emphasising its continued independent foreign policy.

In May 2021, four of the member countries overtly condemned China for its treatment of the Muslim Uyghur population in China’s western Xinjiang region. Similar to the stance taken in the WHO investigation, New Zealand was again the only Five Eyes member who did not question the Jinping Government on this matter.

The Ardern Government is well known for its support for progressive issues and human rights. Taking this into account, New Zealand’s lack of engagement in the dialogue around the human rights violations allegations against the Chinese government highlights its unusual strategy towards China. Although New Zealand did not make explicit comments against Beijing, it has admitted to facing differences in views with China that are “becoming harder to reconcile”. However, New Zealand’s noncommittal approach still remains largely China-positive, which is an effective measure for escaping the repercussions of China’s wolf warrior diplomacy, in which some other Five Eyes members have not been so fortunate.

What does New Zealand have to lose?

Analysts continue to point out that New Zealand is exposed to the Red Dragon. Recently, New Zealand-based corporate body Zespri’s flagship product, the SunGold kiwifruit, was found to have been smuggled into China, enabling local Chinese farmers to cultivate unsanctioned yields of the kiwifruit. In New Zealand, the reaction to this event was subtle, with a focus on cooperation rather than confrontation. Ministers and farmers are of the opinion that a confrontation could lead to the loss of China as a market, and having witnessed the detrimental economic impacts that Australia faced, this concern is prudent. For New Zealand, a conflict with China could mean losing a crucial market for their exports, not limited to kiwifruits.

The Ardern Government’s response, or lack thereof, to the kiwifruit smuggling incident reveals the true nature of the New Zealand-China relationship. New Zealand has a lot to lose and its neutral position towards China is arguably justified. Unlike its allies, who have been forthright in their criticism, New Zealand has employed a different diplomatic strategy and has taken a more cautious approach towards China. With the rise in tensions between New Zealand and its allies, the country’s next move is crucial in determining how the situation pans out. Will New Zealand continue to play a card of neutrality, or will it openly pick a side and, in doing so, risk economic coercion?


Sameera Pillai is a Bachelor of Journalism and Communications graduate from the University of New South Wales. Her interests include human rights, climate change and sustainability, and gender issues.



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