Testing The Anglo-Saxons

Know Thy Enemies: China's Nineteenth Century history recommends a thorough process of getting to know exactly who and what you're dealing with. The Celestial Kingdom's disdain for "Foreign Barbarians" did not work out so well. New Zealand offers the Chinese Government a risk-free environment in which to master the idiosyncrasies of the Anglo-Saxon cultures challenged by its rising economic power.

 

THE PRIME MINISTER has given his recent trip to China a perfect score.

 

“They have really given us great access, they are totally committed to moving the relationship on, there has been a real opportunity to renew friendships and understandings with the new leadership team and we’ve announced things that will make a difference here.

 

“I think it’s a 10 out of 10.”

 

There can be no disputing the value which the People’s Republic places upon its relationship with New Zealand. What we offer our now pivotal trading partner is access to a fully developed, English-speaking, democratic, capitalist society. With our tiny population and strategic irrelevance, China can test and refine here the techniques it must perfect if its increasingly up-close-and-personal interactions with the United States, the United Kingdom, Canada and Australia are to bear diplomatic and commercial fruit.

 

More bluntly, China has chosen New Zealand as its testing-ground. Mistakes made here can simply be written-off to experience. New Zealand is too small (and too dependent on the Chinese demand for its dairy products) to impose any kind of effective sanctions on the Chinese state.

 

What we do have, however, is the ability to reveal the pitfalls awaiting China in jurisdictions large enough to inflict serious damage on both its government and economy. Though we may only be its smallest digit, New Zealand remains one of the five fingers of the Anglo-Saxon fist. And if the exponential growth of China’s productive capacity has reduced its economic power, the Anglo-Saxon Fist still packs an unanswerable military punch.

 

As a policy, pissing-off the Anglo-Saxon’s has not served the Chinese state well in the past, and is most unlikely to do so for the foreseeable future.

 

And that’s where we come in.

 

How will the citizens of the Anglo-Saxon states respond to large-scale land purchases by state-owned, or capitalised, Chinese corporations? That is something the big-wigs in Beijing should probably know before allowing their surrogates to buy up half of Herefordshire or Ohio.

 

And, thanks to New Zealand, they have been given a pretty good idea. Though far greater chunks of the New Zealand landscape had been hocked-off to Americans, Canadians, Indonesians and Israelis, the very idea that even a tiny amount of New Zealand farmland might end up in Chinese hands was enough to bring Kiwis out in a rash.

 

New Zealand’s bi-partisan commitment to keeping Sino-New Zealand relations harmonious was sufficient to prevent any large-scale political exploitation of that popular antagonism. Even so, China’s rulers had been given a taste of the sort of reaction likely to greet large-scale Chinese land purchases in English-speaking countries containing political classes less constrained by considerations of size and economic dependence. The far-right of the US Republican Party, for example. Or, the frankly xenophobic “backwoodsmen” of the British Conservative Party.

 

A recent news-story (published in The Sunday Star-Times of 14 April 2013) offers the Beijing authorities another opportunity to test the political and social reactions of Anglo-Saxons to Chinese ideas and aspirations.

 

Mr Easter Wu, a prominent figure in the New Zealand Chinese business community, has apparently been campaigning for the right to pay immigrant workers less than the statutory minimum wage. In advocating that his compatriots engage in what is a clear breach of New Zealand employment law, Mr Wu confined himself to Chinese-language media outlets.

 

Now that his comments: “How much you are worth is how much you get. You got an $8 skill, I pay you $8.”, have been translated into English, the response of ordinary New Zealanders is likely to be extremely hostile.

 

Not only has Mr Wu been using his high media profile in the expatriate Chinese community to suggest that Chinese employers should ignore the laws of the country in which they have been permitted to operate, but he has also, wittingly or unwittingly, raised up the spectre, in the minds of native-born New Zealanders, that Chinese business leaders are conspiring to undermine their wages and conditions. With New Zealand currently experiencing high levels of unemployment, such behaviour has the potential to produce an ugly and diplomatically unhelpful anti-Chinese backlash.

 

Perhaps the most worrying aspect of Mr Wu’s campaigning is that China’s diplomatic representatives in New Zealand appear to have made no attempt to rein-in their wayward compatriot. Within the Chinese Embassy there will certainly be officers tasked with the close monitoring of the local Chinese-language news media. It is very puzzling (to say the least) that the Embassy does not appear to have taken Mr Wu aside and warned him about the very serious consequences his campaigning risked unleashing.

 

Then again, it’s possible this unwillingness to intervene reflects the Chinese Government’s interest in discovering how Anglo-Saxons react to the idea that Chinese employers should be allowed to operate outside the law.

 

If so, we should let them know.

 

This essay was originally published in The Press of Tuesday, 16 April 2013.

Most Favoured Nation?

Signed, Sealed, Delivered: The signing of the China-New Zealand Free Trade Agreement was hailed as the Clark-led Labour Government's crowning foreign policy and trade achievement. It is simply inconceivable that the Labour Party has forgotten that agreement's "Most Favoured Nation" clause guarantees China the same rights as our other trading partners - including the right to purchase New Zealand farmland.

AT THE RISK of being branded a “traitor”, I’m declaring my support for the Crafar Farms sale. Not because I like seeing productive New Zealand farmland pass into the hands of foreigners, I don’t. The reason I’m in favour of the sale is because I believe New Zealanders should keep their promises and fulfil their undertakings.

In 2008 this country ratified a Free Trade Agreement (FTA) with the Peoples’ Republic of China. That agreement was hailed as the most important foreign policy and trade achievement of the Helen Clark-led government of 1999-2008. Not only was it the first such agreement to be signed between China and a western-style democracy, but it also offered New Zealand businesses immense economic opportunities.

Those opportunities were, of course, reciprocal. The Chinese have been merchants and traders for the best part of three thousand years. They needed no reminding that in this world you don’t get something without giving something in return. And what we gave China was “Most Favoured Nation” (MFN) status.

In the context of the Crafar Farms Sale, MFN means: “If it’s okay to sell New Zealand farmland to Americans, Englishmen, Germans and Indonesians, then it must also be okay to sell farmland to the Chinese.” Under the terms of the NZ-China FTA, the Peoples’ Republic is legally entitled to no lesser consideration than that shown to the most favoured of our trading partners.

That’s what Prime Minister John Key meant when he said “our hands are tied”. It’s what New Zealand’s leading critic of the NZ-China FTA, Professor Jane Kelsey, meant when she stated:

“If the New Zealand government had declined the Shanghai Pengxin purchase of the Crafar farm it could have faced an international law suit for breaching its free trade agreement with China […] The government cannot treat applications from Chinese investors differently from similar applications from other countries’ investors under what is known as the ‘most-favoured-nation’ or MFN rule.”

And that’s not all. Had the application from Shanghai Pengxin been declined by the Overseas Investment Office that decision would almost certainly have been challenged in a New Zealand court. And rightly so. We’d have broken our own rules.

It was all the more perplexing, then, to hear Opposition Leader, David Shearer, declaring his and the Labour Party’s opposition to the Crafar Farms sale. It’s simply inconceivable that Mr Shearer is unaware of the MFN prohibition against denying China the same right to purchase land as the nations that purchased upwards of 650,000 hectares of our national patrimony exercised when Helen Clark was Prime Minister, and Mr Shearer’s friend (and former boss) Phil Goff was the Minister of Trade.

To avoid the inevitable charges of rank hypocrisy and populist opportunism, Mr Shearer needed to accompany his statement opposing the sale with an announcement that Labour was committed, immediately upon regaining office, to repudiating the NZ-China FTA and tightening-up the legislation regulating overseas investment.

I’m still waiting for those other shoes to drop. And, frankly, I think I’ll go on waiting. Why? Because I simply don’t believe Labour is about to abandon its long-standing commitment to free-trade. Nor am I confident that Mr Shearer is any more willing to court the fury and retaliatory trade restrictions of the Chinese Government than Mr Key. Both men are well aware that this country’s future prosperity is inextricably bound up with China’s.

If foreign ownership of New Zealand land was something successive New Zealand governments wished to restrict, then they should have legislated against it before they embraced the doctrine of free-trade. And if we, the people, were serious about preserving our patrimony, then a majority of us would’ve voted for the political parties – the Alliance, NZ First, the Greens, Mana – which promised to do exactly that. But, the closest the New Zealand electorate’s come to voting against free-trade (27 percent) was the election of 1993. In 2011 the anti-free-trade vote was just 19 percent.

It’s a little late, now, to shout: “Stop!”

This essay was originally published in The Dominion Post, The Otago Daily Times, The Waikato Times, The Taranaki Daily News, The Timaru Herald and The Greymouth Star of Friday, 3 February 2012.