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The Ministry conducts an annual forward-looking scan of the international environment, to identify current trends and key drivers of change. Key strategic foreign and trade policy issues facing New Zealand are described below.
Australia is New Zealand’s most extensive and important relationship. It is our largest trading partner, closest defence ally, and key foreign policy partner. Australia’s stake in the New Zealand economy is large and many Australian policy and regulatory settings are fundamental to the good working of the New Zealand economy. There is intense contact at all levels of government, business and society. New Zealand’s diplomatic representation in Australia was expanded in 2008 and now includes the High Commission in Canberra, and Consulates-General in Sydney, Brisbane and Melbourne.
Australia demonstrates assertive self-confidence at home and abroad. Its economic and political influence as a middle power continues to grow. Australia is becoming a regional economic powerhouse and a global investor. Prime Minister Rudd is strongly engaged internationally in advocating improvements to the international financial system. A formal alliance with the United States is a bi-partisan centrepiece of Australia’s foreign policy. Australia also attaches priority to strengthening relationships in Asia. The Rudd government has stressed the need to rebuild Australia’s profile in multilateral organisations and in the Pacific.
New Zealand’s relationship with Australia delivers mutual benefit. There has been a shared disposition in recent years to manage it actively. Structured political engagement led by the Prime Ministers is recognised as being important in setting a positive tone, affirming overall priorities and objectives, and managing differences. Annual Prime Ministers’ meetings have taken place since 1997. The regular contact that occurs between other ministers draws from and builds on this focused contact.
Key New Zealand interests include:
Current areas of focus include:
New Zealand has close relationships with most Pacific countries, especially in Polynesia. It has specific responsibility for Tokelau and constitutional links with Niue and Cook Islands, and a Treaty of Friendship with Samoa.
New Zealand’s national identity and interests are closely intertwined with the Pacific. There is a domestic dimension through the presence of large Pacific island communities in New Zealand.
New Zealand has broad political, security, economic, environmental and human rights interests in the region.
The security and development outlook for the Pacific remains fragile within a variable and increasingly contested “consent environment” for international engagement. Many states in the region continue to face challenges around weak institutions of state, poor overall economic growth further threatened by the current global financial/economic turmoil, environmental vulnerability, political instability, adverse social trends and further demands of globalisation.
The delicate stability in Tonga and Solomon Islands and ongoing tensions in Fiji underscore the need for carefully targeted, collaborative whole-of-Government responses, involving Pacific partners, other key partners (particularly Australia) and regional and international institutions. Where positive examples of good governance and economic management exist, efforts must be made to support and reinforce them. Concerns over loss of sovereignty and scepticism about the value of regionalism will need to be countered by demonstrating the benefits of regional approaches in addressing key issues (such as the Forum’s bulk fuel procurement initiative). The complex environment highlights the need for effective public diplomacy to ensure that New Zealand’s policies are fully understood by both external and domestic constituencies.
While bilateral engagements will continue to be a key focus for New Zealand, there is also a growing need to encourage effective regional mechanisms and coordinated regional approaches in the Pacific.
Fiji remains a major focus of political attention in New Zealand. In Solomon Islands, the future shape and operation of the Regional Assistance Mission (RAMSI) will continue to require close monitoring. Beyond these immediate “crisis” areas, there is a range of other relationships, including with Polynesia, that inevitably attract close domestic scrutiny and need to be maintained, broadened and strengthened in order to advance New Zealand’s interests. top of page
The trend towards greater instability in the Pacific is taking place at a time when there has been an increased focus on broader regionalism, being pursued through the Forum and related regional bodies. With the potential for the Pacific Agreement on Closer Economic Relations (PACER)-Plus trade negotiations to begin as early as next year, the regional trade agenda is expected to grow in significance. Other priorities include fisheries, the broadening security agenda, environment, and engagement with regional agencies, many of which are struggling to cope with increased expectations to deliver regional outcomes.
It is clear that the Forum and other regional agencies are finding it difficult to meet the diverse and differentiated needs of their memberships. With a new Forum Secretary General, Tuiloma Neroni Slade, one of New Zealand’s key concerns will be to promote greater effectiveness of regional cooperation.
Against this background, and in close consultation with NZAID, the Ministry’s efforts remain directed at promoting an enabling environment for good governance, economic growth, sustainable development and stability. The Ministry has also continued to promote enhanced regional integration, particularly under the umbrella of the Pacific Plan. The whole-of-Government effort to address security issues gives the Ministry a growing role in co-ordinating Pacific policy with other New Zealand Government agencies. This component of the Ministry’s work is expected to become more demanding.
New Zealand’s identity and destiny are closely intertwined with the Pacific. The character of New Zealand’s interests is unlike those with any other region. New Zealand seeks to be a reliable neighbour and friend, working with Pacific island partners to pursue development, growth and stability.
New Zealand has 10 posts in the Pacific: High Commissions in Cook Islands, Fiji, Kiribati, Niue, Papua New Guinea, Samoa, Solomon Islands, Tonga and Vanuatu; and a Consulate-General in New Caledonia. We are accredited to American Samoa, Marshall Islands, Federated States of Micronesia, French Polynesia, Nauru, Palau, Tuvalu and Wallis and Futuna.
Security: Corruption, poor governance, ethnic tensions and compromised institutions of state are challenging efforts to build regional coherence. New Zealand is working with other donors to help Pacific island countries (PICs) meet new mandatory international requirements in areas such as counter-terrorism legislation, transport security, finance and border control. PICs are increasingly having to respond to or engage with a variety of international actors, both government and private sector entities from wider regions.
The Pacific Plan represents the agreed framework for prioritisation of regional initiatives among Forum island countries, with many of the objectives reflected in members’ individual development plans. Current priorities include cooperation on fisheries; energy; trade and economic integration; climate change; transport; information and communications technology; health; education; good governance; and land. Progress has been patchy, but the Plan has proved a useful vehicle to promote regional cooperation.
Trade: Annual two-way trade between New Zealand and the Pacific in goods is now worth over NZ$1 billion and trade in services (mostly tourism to the Pacific) is increasing in value each year. The aim is to encourage a process of trade and economic cooperation in order to create favourable conditions for private sector-led growth and to stimulate economic development in the region. PACER (Pacific Agreement on Closer Economic Relations) provides a framework. New Zealand and Australia have been encouraging progress through informal officials’ level discussions. At this year’s Forum, Leaders called for the development of a detailed road map on PACER Plus, with a view to agreeing to the commencement of negotiations at the 2009 Forum. The next informal officials’ meeting takes place in Tonga 12-14 November.
Labour Mobility: New Zealand’s Recognised Seasonal Employer (RSE) policy commenced in April 2007. It enables up to 5,000 foreign workers a year to gain seasonal work in horticulture and viticulture, with preference being given to workers from PICs (excluding Fiji). The scheme has been well received in the Pacific and a number of PICs have made clear their desire to see concrete bilateral commitments from both Australia and New Zealand on labour mobility, including for unskilled labour, in the PACER context.
Working with External Partners: Competition for influence in the Pacific is increasing, with more external actors jockeying for diplomatic and commercial advantage. In its dealings with other players and partners in the Pacific, New Zealand has highlighted the importance of engagement that is geared towards the longer-term development needs of the region. Collaboration and coherence with other regional partners, including the European Union, United States, France, Japan and China remain central to New Zealand’s Pacific diplomacy.
As the two developed country members of the Forum, New Zealand and Australia work to ensure a “joined-up” approach in addressing Pacific issues. Under the Rudd government, Australia has reaffirmed that close cooperation with New Zealand is an integral part of its new Pacific strategy. Detailed policy discussions on Pacific matters are an increasing focus of trans-Tasman Ministerial and Prime Ministerial meetings.
Fiji: Seeking an early restoration of democratic government in Fiji in unity with Forum partners. The 2008 Forum sent a clear message to the Fiji Interim Government (FIG) that further delaying a return to democracy will have significant consequences, including possible Forum suspension. The Communiqué set out a viable "exit strategy" for the FIG, involving an election by March 2009 under the current Constitution, preceded by a political dialogue that would enable appropriate understandings to be reached with other stakeholders. The remaining weeks of 2008 will be an important time for the FIG to engage on the Forum-endorsed exit strategy. The Forum Foreign Ministers Contact Group on Fiji (comprising Tonga (Chair), Australia, Tuvalu, New Zealand, Papua New Guinea, Samoa) may visit Fiji in early December; followed by a possible Special Leaders meeting in Papua New Guinea. New Zealand has been encouraging all Forum members and external partners to take appropriate opportunities to underline their support for the ongoing Forum-led effort on Fiji.top of page
Solomon Islands: Promoting good governance and stability especially through the Regional Assistance Mission to Solomon Islands (RAMSI) and ODA. A number of important initiatives are currently underway, including a Solomon Islands “Parliamentary review” of RAMSI and the development of a new RAMSI/Solomon Islands Government Partnership Framework. As the second largest contributor to RAMSI, New Zealand seeks to work closely with Solomon Islands, Australia (which provides the bulk of resourcing for RAMSI) and regional partners to ensure that our views on the future shape and operation of RAMSI continue to be taken into account. Regional unity and support for RAMSI remain essential to its ongoing credibility and success.
Polynesia: A number of positive developments, including Tonga’s progress towards a more broad-based democracy. New Zealand concluded a bilateral WTO accession agreement with Samoa on 8 March 2008 and fully supports Samoa’s bid to accede to the WTO, although conclusion of the process is likely to be some years away.
Melanesia: An increasing focus of New Zealand’s diplomatic efforts. The socio-economic indicators of some Melanesian countries are almost on a par with those of sub-Saharan Africa, and internal volatility, land conflicts, and ethnic tensions further drive down standards of living. As a result of significant financial gains from the successful exploitation of its mineral wealth, Papua New Guinea has become a more crowded playing field. New Zealand will need to continue to work hard to maintain its level of engagement and influence.
The Cook Islands and Niue are “self-governing in free association with New Zealand”. Tokelau is a dependency. The citizens of each have New Zealand citizenship and a majority have made their home in New Zealand. Successive New Zealand Governments have committed to providing economic and administrative support to enable these three separate parts of the Realm of New Zealand to function as viable and forward-looking communities.
Cook Islands has the most mature relationship with New Zealand. It has moved past the stage where it requires direct budget support. In 2001 a Centenary Declaration was negotiated setting out the state of the relationship. A fundamental principle is the obligation on both governments to consult closely as partners on foreign affairs and other issues of shared interest. Cook Islands has developed a separate international identity over the last 18 years, the implications of which are the subject of regular discussion between Wellington and Rarotonga.
Since the last Cook Islands elections in September 2006 the political situation has remained relatively stable on the surface. The Cook Islands economy has been performing relatively well and prior to the latest external economic pressures had been expected to continue growing. Tourism is the dominant sector but remains vulnerable, despite record visitor numbers in 2007. Pearl exports, a major contributor to local economies in the Northern Cook Islands, continue to be the largest earner. Fisheries exports have declined in recent years but have the potential to grow significantly. The largely subsistent outer islands are the focus of New Zealand’s development assistance which totalled $7 million in 2008/09. A further $10 million over three years to 2009/10 has been made available for infrastructure relating to cyclone recovery.
The 2006 Cook Islands census recorded a population of slightly under 20,000. In the New Zealand census of the same year 57,000 people described themselves as Cook Island New Zealanders.
Niue, self-governing since 1974, is facing substantial challenges to maintain a functioning community on the island. In elections in June 2008 one of the island’s few prominent businessmen, Toke Talagi, a former Finance Minister, defeated Young Vivian 14-5 to secure the Premiership. After an early official visit to New Zealand and successful chairing of the Forum Leaders’ meeting in August, Premier Talagi has passed his first budget and is now focussing on ambitious initiatives to reverse Niue’s decline.
In 2008/09 Niue will receive $16 million in assistance from New Zealand and a further $5 million contribution to the Niue International Trust Fund. Niue’s population continues to decline from almost 5,000 in 1974 to about 1,200, fewer than one thousand of whom are Niuean.
Tokelau’s needs are largely met by New Zealand. Tokelau is considered at the annual meeting of the United Nations Special Decolonisation Committee. Two self-determination referenda in the past two years have not achieved the levels of support needed for a change of status. Increased efforts by Tokelau and New Zealand are being directed to improving the availability of basic services on the atolls. Considerable effort continues to be made to enable Tokelau to take responsibility for the management of its affairs. The post of Administrator of Tokelau remains, but the associated powers have been largely devolved to the village council on each atoll, and through them to the Council for the Ongoing Government of Tokelau.
New Zealand provides funding for Tokelau’s social and economic development through a three-year Economic Support Arrangement, amounting to $40 million for the period 2007/08 to 2009/10. Further funding of $4 million has been provided for major infrastructure projects. A 25-year dedicated shipping charter to provide assured shipping links between the atolls and with Samoa is expected to come into service in the second half of 2010.
The three atolls of Tokelau have a population of about 1,450. More than 8,000 people in the 2006 New Zealand census identified themselves as Tokelauan.