A small state’s diplomacy in challenging times
Delivered by Chris Seed, New Zealand High Commissioner to Australia, at Sir James Plimsoll Lecture on 29 October 2018.
Tihei mauri ora! (Behold, there is life)
Te whare e tu nei, tēnā koe (I greet the house we meet in)
Te papa i waho nei, tēnā koe (I greet the land outside)
Te mana whenua o tēnei rohe, tēnā koutou (I greet the local and traditional peoples of this place)
Te hunga mate kit te hunga mate, haere, haere, haere atu ra (I pay tribute to our ancestors/to the dead)
E ngā mana, e ngā reo, e rau rangatira mā (To the respected people, speakers and leaders here tonight)
Tēnā koutou, tēnā koutou, tēnā tatou katoa. (Greetings to you all)
Mr Rob Atkinson, Acting Deputy Vice-Chancellor of the University of Tasmania, and other members of the University faculty.
Professor Peter Boyce, former President of the Australian Institute of International Affairs. Thank you for your recollection of the extraordinary Australian and diplomatic practitioner we are honouring tonight.
Ms Kim Boyer, President of the Tasmanian Branch of the Australian Institute of International Affairs. Thanks for your introduction, but also to you and the committee, which extended the invitation and made tonight possible.
Ms Harriet Baillie and Mr Charles Brewer, Co-Directors of the Tasmania State Office of the Department of Foreign Affairs and Trade
Ms Kathleen Plimsoll
Distinguished guests, ladies and gentlemen,
Let me start by honouring what we would call in New Zealand the mana whenua - the Palawa peoples and their nations, the traditional owners and custodians of the land here – and pay my respects to Elders past and present.
Thank you too for the invitation to be with you this evening to offer some thoughts on small state diplomacy in challenging times.
New Zealand and Tasmania – Fellow Small States
It’s particularly fitting to be here in Tasmania, a fellow small state, for which kiwis have long-standing connections and a deep affinity.
Flying in this morning, the air, the colour and the clarity seemed so very familiar. In a physical sense, our islands seem a bit like geographical twins separated at birth.
Our modern historical ties date back at least to the seventeenth century to our shared (European) discovery by Abel Tasman.
And in an ironic twist given the current issues on the modern bilateral agenda with the deportation of New Zealanders, researchers from this University have revealed that the Van Diemen’s Land penal colony once served as New Zealand’s first offshore detention centre for deported criminals - and even Māori Prisoners of War.
We’ve furnished one another with a handful of colourful characters over the years. From the instigator of the Otago gold rush, Gabriel Read; to controversial First World War sex education pioneer, Ettie Rout.
And Tasmania also provided Australia’s first High Commissioner to New Zealand: the extravagantly named and larger than life Thomas George D’Largie D’Alton, who took up residence in Wellington in 1943.
Incidentally, D’Alton was one of two Australians appointed that year as the inaugural trans-Tasman High Commissioners.
The New Zealand government also thought long and hard about the best New Zealander to first prosecute its interests in Canberra...
…and appointed an Australian. Sir Carl Berendsen was born in Sydney and spent the first twelve years of his life in Woollahra.
Much like Sir James Plimsoll, Berendsen is regarded as one of New Zealand’s most distinguished diplomats; the founder of our foreign service. But he was undoubtedly eclipsed by his Tasmanian counterpart, D’Alton.
A boilermaker by trade, an actor by calling and a politician reputedly by coin-toss, D’Alton’s CV listed skills including juggling, fire-eating, amateur theatre and navigating Tasmanian Labor party politics. Quite the skillset…
But his overseas career reads more like a cautionary tale.
While in Wellington, he reportedly boasted the city’s finest wine cellar. (Admittedly this is a slightly less impressive feat given the realities of 1940s New Zealand.)
And despite his social successes, he unfortunately made the papers after getting into a fist fight at a theatre.
To top it off, his posting was memorably curtailed by having to return to Tasmania in 1946 to answer criminal charges from historic corruption allegations.
Indeed, such was D’Alton’s diplomatic ‘brand’ that a subsequent attempt in 1950 to appoint him Tasmania’s Agent General in London prompted an outraged Speaker to dissolve the House and call a general election.
Going the other way, at least two of Sir James Plimsoll’s Tasmanian vice-Regal predecessors, Thomas Gore-Browne and Frederick Weld, first cut their gubernatorial ‘teeth’ in nineteenth century New Zealand.
And to be fair to Tom D’Alton, both of them had rather mixed political records in New Zealand as well…
But perhaps our greatest connection is our shared experience as fellow small states, albeit one within the Federation and one without.
Because more than anyone else, we can each empathise with the charms and challenges of dealing with the continental cousins up in Canberra.
Sir James Plimsoll
It’s also a special honour for me to deliver an address named for Sir James Plimsoll. It’s customary in these lectures to establish a personal connection with the great man. And I’m pleased to say my remarks tonight will be no exception.
I won’t attempt to lay claim to a career as storied as Sir James’s – nor those of previous speakers who have honoured his career in this lecture series.
But he and I did at least work for the same Department – though one of us for slightly longer and with arguably better results for Australia.
I was sent on my first diplomatic assignment to be the New Zealand Exchange Officer to the Department of Foreign Affairs and Trade in 1987.
And as it happens, that role actually brought me into contact with Sir James.
DFAT’s graduate intake that year paid a visit to Hobart in late April with their New Zealand exchange officer in tow.
Part of our program involved a reception hosted at Government House by then-Governor Plimsoll. This generous vice-regal willingness to meet with an itinerant gaggle of grads clearly reflected his personal interest and background as our former Departmental Secretary.
Sir James’s generosity to us that day was completely consistent with the man described in Jeremy Hearder’s biography. He insisted we call him “Jim” and even invited us to share in his birthday cake.
Those familiar with “Jim Plim’s” personal history will note that that places us there on or about ANZAC Day, which would have been Sir James’s 70th birthday.
It also means that we were with him only about two weeks before he died on 8 May that year.
In hindsight, it could well be that our visit was among Sir James’s last official engagements with his former department.
Our nervous and enthusiastic bunch was about as far a cry as possible from the international luminaries with whom Sir James routinely rubbed shoulders.
But given his renowned passion for mentoring junior staff, which Peter spoke of so powerfully earlier this evening, there is also something about it that seems somewhat fitting.
Plimsoll and New Zealand
Despite being born on ANZAC Day, and meeting me on his 70th birthday, it’s fair to say the trans-Tasman relationship was not the central focus of Sir James’s professional career.
But as a number of Federal politicians have recently discovered, New Zealand connections have a habit of sneaking up on you.
And the depth and breadth of the relationship is inescapable – even for Sir James.
For a start, he could well have been born a kiwi. His father - also James - spent many years in New Zealand before relocating to Sydney where Sir James was eventually born.
As a young man, Sir James trained as a banker in an Australasian bank in what was then, as now, a highly integrated trans-Tasman financial sector.
In the depths of the Korean War, his reporting from Seoul was facilitated by the New Zealand defence force, who stored his Top Secret comms equipment.
Accounts of his various postings show him in routine contact and confidence with his kiwi counterparts.
And although peripheral to Sir James’s diplomatic career, one of the more remarkable vignettes in Hearder’s biography actually happened at what is currently my place.
On 17 December 1967, the night of Harold Holt’s disappearance, Hearder writes that Sir James attended a dinner at the New Zealand High Commissioner’s residence in Canberra, with none other than Paul Hasluck and John Gorton.
After dinner, over what must be one of Australia’s more momentous games of Scrabble, Hasluck and Gorton thrashed out their plans for the liberal leadership succession. Gorton of course went on to replace Holt, and Hasluck to be Governor General.
Ever the professional public servant, Sir James reportedly recused himself from the political conversation and left them to it.
Hearder’s record is silent however as to whether the New Zealand High Commissioner of the time was similarly discreet!
But the episode speaks volumes of the underlying intimacy between our countries – even more so given that John Gorton was himself rumoured to be kiwi by birth.
This was evidently at a time when the constitutional implications of that birth right were rather less front of mind than today.
…though it might also be argued that the recent dual citizenship revelations in the Federal Parliament simply give the truth of the common political refrain that our two countries are “family”.
Because closer analysis shows the trans-Tasman political family tree to be surprisingly deep-rooted.
At a rough count, we’ve furnished each other (voluntarily) with at least three – and possibly four Prime Ministers.
Remarkably in fact, nearly every major political party currently represented on either side of the Tasman has at one time boasted a leader or deputy leader who hailed from the other side of the ditch .
Plimsoll’s “challenging times”
Returning however to Plimsoll, his New Zealand connections aside, the decades Sir James spent representing Australia included some of the most “challenging times” of the previous century.
At a time when “now-ism” is once again in vogue, it’s worth recalling that these included the Second World War; the attendant threat of invasion; the Cold War; two major conflagrations in Viet Nam and Korea; and an Indo-Pacific region seemingly perpetually primed for conflict.
Economically, our region was war-ravaged, closed to trade and impoverished.
And during his posting in Brussels, Sir James also dealt directly with the political and economic fallout of Britain’s entry to the European common market.
The loss of what was then our largest single export market was a traumatic experience for both our countries, though arguably more so for New Zealand, which lacked the counterbalancing ‘hedge’ of Australia’s burgeoning coal trade with Japan.
Today’s strategic context
In the context of today’s strategic anxiety, it is tempting to reach back to those ‘challenging times’ for historic parallels.
But doing so also reminds us how different Plimsoll’s operational context was from the world we inhabit today.
And frankly, from a New Zealand perspective, there is much to be preferred about the present.
For a start, the Bledisloe Cup is in its rightful place.
Rugby aside, when New Zealand looks out on the world, it is clearly to our advantage that our nearest geographic neighbour is also our closest friend and only ally.
And the most rapid middle class expansion in economic history is occurring in our hemisphere.
Just last month, the Brookings Institute declared that for the first time in history the global middle class now outnumbers those classified as ‘vulnerable’ or ‘poor’.
It also estimated that ninety percent of the next billion middle-class consumers will be Asian – a broad distribution from India and China through South and South East Asia.
That cohort’s continued demand for higher quality goods, services, minerals and protein will remain a historic economic opportunity for both our countries.
And their attendant insistence on more and better government services – whether that be housing, healthcare and education, or ‘intangibles’ like responsiveness, transparency and accountability – may yet prove a powerful constraint on conflict, and a further niche for our own influence.
In a further contrast to Sir James’s day, our region also sports a degree of security and economic architecture, in which both our countries are embedded. Our position in these institutions, from the mature to the nascent, brings with it an influence that outstrips our size and location. This is certainly the case for New Zealand.
At a global level too, the core elements of the post-war order established by Sir James and his contemporaries, remain in place.
Although clearly under pressure, there are still powerful incentives for its retention and reinvigoration.
It is implausible for instance that any permanent member of the Security Council would want to see its authority demolished. Or that any major trading nation would seriously want to see the collapse of economic openness and rules which set a level-playing field.
We are also seeing – and in some cases supporting – attempts to reinforce global rules.
This includes areas such as the Nuclear Weapons Prohibition Treaty; the Paris Agreement and in regional and plurilateral trade initiatives such as the Comprehensive and Progressive Agreement for Trans Pacific Partnership (CPTPP), which has passed both our Parliaments this past fortnight.
Challenging times today
But none of this is to deny the genuine challenges that we do face today.
There is no question that global power is currently being contested and that the international system and the rules and structures which underpin it are under pressure.
Pervasive challenges like climate change, unregulated migration and uneven access to the benefits of globalisation are fuelling uncertainty and nationalistic reactions, even in countries as egalitarian and well-organised as Australia and New Zealand.
Global resilience has been weakened by rising debt and falling social licence.
And to paraphrase Yogi Berra, it’s now tougher than ever to make predictions … especially about the future.
In our own hemisphere, the unprecedented rise in living standards is being matched by an equally unprecedented strategic dynamism.
Never before have the United States, China, Japan and India been major regional powers simultaneously.
New constructs such as the Belt and Road Initiative and the Free and Open Indo-Pacific are emerging to reflect these realities.
Many of the world’s potential hot-spots are in a part of the world – North Asia – where formal normative architecture is either wholly absent or at a very early stage of maturity.
And for the first time in a long time, our immediate strategic neighbourhoods – the Pacific and Antarctica – are transitioning from a period of being neglected by Great Power ambition to an increasingly contested strategic space.
Added to which they are both disproportionately – and existentially – threatened by the impacts of a changing climate.
Against this background, the risks for small states with global interests are acute and the margin for error as narrow as ever.
Small State Diplomacy: Thucydides and the Melian Dialogue
In times like these, a popular reference point for international relations theorists – particularly those of the ‘realist’ school – is Ancient Greece and Thucydides’ history of the Peloponnesian War.
Harvard Professor Graham Allison’s concept of the “Thucydides trap” neatly captures the risk of conflict prompted by escalating mistrust between established and rising world powers.
Its current resonance has seen it invoked by world leaders ranging from Malcolm Turnbull to Xi Jinping.
But as it happens, Thucydides didn’t just limit his advice to the major powers – the modern day Spartans and Athenians of the world.
He also dishes out some pretty sobering lessons for small states along the way.
His principal device for this is the infamous Melian dialogue. It is a fictitious conversation between representatives of the island of Melos – a small island state east of Sparta – and Athenian generals, in this case the putative “great power”.
The exchange commences with the invading Athenians presenting the poor Melians with a stark and unpalatable choice: surrender or annihilation.
If you’ll forgive the spoiler: it ends with the Melians refusing the former (surrender) - and receiving the latter (annihilation).
Prior to this though, the Melians offer a number of reasons why they should be left alone. Their arguments run the full idealistic gamut – with appeals to justice, morality, patriotism, pride, piety, and lastly, hope.
Suffice to say, all this is given short shrift by the realist Athenians.
The subsequent carnage inflicted on the Melians shocked even war-hardened Greeks. And to this day their fate remains seared on the minds of any student of international relations theory - as well as any small state representatives.
So too is the chilling Athenian justification that “right, as the world goes, is only in question between equals in power; while the strong do what they can, the weak suffer what they must”.
…or, as a Tasmanian government official might interpret it, “just another day at COAG”.
From Melos to Modernity - Small States today
Human nature may be unchanging, as Morgenthau attests. But happily for modern small states, our operational context has moved on a bit since 415 BC.
The benign global conditions of recent decades have undoubtedly and disproportionately benefited small states.
This is reflected in our outperformance on a range of economic and social metrics.
Of the 34 countries classified by the IMF as advanced economies, 23 have populations of fewer than 20 million.
Small states comprise fifteen of the top twenty in this year’s UN Human Development Index as well as six of the top ten in the World Economic Forum’s Global Competitiveness Index.
And the Legatum Institute’s 2017 Global Prosperity Index, which ranks states across a broad range of economic, social, political and environmental indicators, featured seven small states in its top ten.
(It would also be remiss of me not to point out that New Zealand is ranked second on this index, behind only Norway.)
But in the context of a changing, and increasingly challenging, outlook, the Melians remain an important reminder that simply sitting back and hoping for the best is not a strategy.
Small states need to be active, strategically vigilant, situationally agile, and continually investing in their stock of foreign policy capital and capability.
New Zealand – the foundations
So how does New Zealand stack up?
To borrow from another realist historian, E.H. Carr, an international order “cannot be understood independently of the political foundation on which it rests and the political interests which it serves”.
And so any assessment of the effectiveness of New Zealand’s foreign policy must therefore begin at home.
Turning first to the foundations - as you would expect from an earthquake-prone country, these have to be pretty strong.
The first of these is our democratic infrastructure. Our institutions are long-standing and robust. Judged by the yardstick of universal suffrage – and the Duchess of Sussex’s shout-out in Wellington yesterday – we are the world’s oldest and longest running democracy.
Our Parliament is responsive, respected, and increasingly reflective of New Zealand society, with record numbers of women – 40 percent in the current Parliament – as well as Māori and Pasifika MPs.
This has also been accompanied by a generational shift. For the first time in a long time, there are more New Zealand MPs aged under 50 than those above it. The Prime Minister is 37; the Leader of the Opposition 41, and the leader of the Greens, 44.
Despite early scepticism, especially from this side of the ditch, the MMP electoral system introduced in 1996 has correlated with more than twenty years of relative government stability and pragmatic policymaking.
Complementing this are legal and regulatory frameworks that are sturdy yet flexible, overseen by trusted courts and stewarded by a bureaucracy which is attentive, innovative and ethical.
This is reflected in New Zealand’s simultaneous number one ranking in both the World Bank’s Ease of Doing Business Index and Transparency International’s Corruption Perceptions Index.
A second key foundation is the resilience of the economy. (After all, like any instrument of state, foreign policy must ultimately be paid for.)
Happily for salaried kiwi diplomats, here too the signs are good. The IMF’s 2018 World Economic Outlook forecast New Zealand’s growth rate to remain around 3 percent in 2018 and 2019 - a stronger growth forecast than nearly any developed country peer.
Our record high terms of trade reflect a resilient and diverse portfolio of products and markets. Our top two thirds of exports are spread among five trading partners, and no single country accounts for more than 20 percent of two-way trade.
Unemployment is currently at 4.5 percent and has been projected to head towards 4 percent over the next few years.
And earlier this month, the government posted a $5.5 billion dollar surplus. This continues an unbroken four year run first begun under the previous National administration in 2015.
Those results have seen net Crown debt reduced to around 20 percent of GDP – lower than nearly any other advanced economy and a fraction of the G7 average.
It has also enabled one of the largest investments in our foreign policy capability in over a decade, including three quarters of a billion dollar increase in ODA over the next four years.
A third critical foundation is our social capital.
This is underpinned by the constitutional and practical commitment to bicultural partnership enshrined in the Treaty of Waitangi. Those efforts in turn have provided a social framework for an increasingly multicultural demography. One in five New Zealanders – approximately one million people – now have Maori or Pasifika heritage.
That demographic trend is itself another foundation. It reaffirms New Zealand’s identity as a country with global interests reflecting its global heritage, but also one that is anchored to the Pacific region through geography and a thousand-year old human connection of habitation, history and culture.
Underpinning all these foundations is a bedrock of values.
New Zealand’s values, which are rooted in fairness and a reputation for domestic stability, cultural respect and constructive pragmatism, lie at the heart of our soft power and our diplomacy.
This is not to dismiss our hard power —the deployments of our defence and diplomatic assets where these are needed. But ultimately, we have to get a long way in the world by being New Zealanders, with all that our partners think that stands for.
Making our way in the world – resilience at home
Those foundations and values are critical to our interests. Ensuring their resilience to global events must therefore be a primary and whole-of-government concern.
Like any small state, New Zealand must balance the need for global integration with an acute understanding that we are not immune from the risks of global exposure.
Memories of the recession prompted by the GFC remain fresh. As do memories of some of the negative consequences of our 1980s reforms.
Our internationally mobile population is as exposed as any other to conflict, natural disasters or terrorism. Among OECD countries, only Ireland has more of its citizens living abroad.
As an island country and agriculture-reliant economy, we absolutely understand the security implications of a changing climate.
And like many other countries, concerns over the uneven distribution of globalisation have weakened the social licence for a range of policy initiatives both at home and abroad.
As Prime Minister Ardern has underlined, taking action to reinforce that resilience and reinvigorate that social licence is a whole of government priority.
In her recent address to the United Nations, she spelled out that this means being resolute in our commitment to democracy; the rule of law which underpins and stems from it; and to the civil, political and human rights which New Zealand has signed up to and enshrined in law.
It also impels us to act in ways which reinforce our domestic institutions. In practical terms, that means the bureaucracy providing free and frank policy advice or meeting its legal obligations around the freedom of official information.
And in our strategic actions we must do all that we can to help build and burnish New Zealand’s economic, social, environmental and human capital.
Because as Foreign Minister Peters has said last week at an event to celebrate 75 years since the founding of our diplomatic service, the greater our resilience and self-reliance, the more scope we will have to continue to act with independence abroad.
Strategic choices – the direction of effort
Identifying and safeguarding our values and foundations is one thing. But it is not the same as having a clear sense of where those interests lie and which of them we should pursue.
Like any small state, we face the hard reality of limited resources.
This inevitably demands strategic choices.
For New Zealand, these choices are evident in our current priorities.
For a start, we are working to strengthen, protect and use the rules-based international system which reflects our national values.
At the same time, we must ensure we are helping build, influence and embed ourselves in the institutions that give effect to these rules.
This includes intensifying efforts to embed New Zealand as an active and integral partner in the Asia-Pacific, with a particular focus on regional stability and economic integration.
The Government’s Pacific Reset signals a more ambitious and joined up approach to our long-standing effort and non-discretionary interest in a stable, prosperous and resilient Pacific.
We are continuing to work on sustainable solutions to global environment and natural resource challenges. We are heavily invested, including this week in Hobart, in the Antarctic Treaty system.
And we are continuing to invest in a wide range of international security efforts. These include the government’s announcements last month of an extension of the New Zealand Defence Force military training deployments in Afghanistan; our joint Australia-New Zealand mission in Iraq; and a renewal of three peacekeeping missions in the Middle East and Africa.
We are also helping to build a productive, sustainable and inclusive economy at home by growing the value, sustainability and reach of New Zealand’s exports.
Our commitment to doing this through open, plurilateral agreements such as the CPTPP is helping reinforce the ‘public good’ of global trade rules. And the government’s ‘Trade for All’ agenda is directly contributing to rebuilding the social licence for trade within New Zealand. In practical terms, that means securing the support of ordinary kiwis for the trade arrangements which deliver jobs and opportunity at home.
Woven through all of this is the understanding that our foreign policy must continue to reflect our values and reinforce our interests.
In part, this is because New Zealanders expect this of their representatives. As Prime Minister Ardern has put it, when New Zealand speaks, it must be with credibility. When it acts, it should do so with decency.
But this also reflects a clear-eyed understanding that acting in this way is also key to advancing our interests.
Simply put, small states cannot command influence through raw power. Nor can they afford to make their way through duplicity, capriciousness or obstructionism.
Our national interests can only be advanced if our partners know us, value us and trust us. In other words, the very way kiwis expect us to act – with courage, humility, honesty, fairness, pragmatism and kindness – also just happens to be the best way to maximise our influence and advance our interests abroad.
Prosecuting our interests
But what about the actual practice of small state diplomacy?
Having distilled our interests from our foundations and values and decided the direction of effort, how does a small state actually go about prosecuting its interests?
Plenty has been written since Thucydides about the strategies and practices that small states can adopt.
Personally, I like to think in simple constructs. And coming from a family of three brothers, these usually come in threes.
For me, the small state diplomatic ‘playbook’ divides broadly into three broad principles: narrative, architecture and connections.
The first is ‘narrative’. A small state’s influence is ultimately determined by its relevance. This in turn depends on its ability to tell its story and to sell its values and ideas. It must be seen by partners as both interested and interesting - engaging and engaged.
Or as another Greek international relations theorist, (and sometime senior New Zealand diplomat) Vangelis Vitalis, has described it – this means small countries need to be engaged in a constant process of protecting, burnishing and investing in their reputation.
They must build their ‘value proposition’ carefully, remain acutely aware of it and continually reinvest in it to ensure that it offers partners insight, creativity and credibility on a broad set of issues.
In New Zealand’s case, our value proposition stems from the domestic foundations and values I listed earlier, together with our international legacy.
This includes our track record of multilateral engagement; our historic and ongoing hard power contributions; our economic and trade leadership, and our instinctive understanding of the concerns of other small countries – above all the critical connections between economic, security and environmental factors, especially for the Pacific.
It is those contributions which make the small state ‘relevant’ and enable it to leverage, protect and ultimately advance its own national interests.
But it also means that small states need to become more self-consciously self-promoting. They need to get out and sell their story and their ideas.
The second principle is architecture. This goes to the idea that small states can best project their influence by amplifying it through constituencies, force multiplication frameworks and shared rules and norms.
At one level, this is about doing all we can, both individually and collectively, to embed ourselves into emerging architecture and to buttress the existing frameworks which reflect our values and level the playing field in our favour.
But at another level it is also about being open to, and active in driving, new arrangements which are open and transparent and consonant with our values and interests.
Small countries do not have the luxury of waiting for invitations. Using their ‘value proposition’ they must be active in building constituencies that can magnify their influence and achieve critical mass in lobbying major powers.
In New Zealand’s case, these efforts could range from the traditional CANZ groupings in multinational forums, through to more bespoke constructs with non-traditional but likeminded partners.
Examples of the latter include our participation in the Small Advanced Economies Initiative with Singapore, Denmark, Israel and Finland; the WTO “Friends of Fish” grouping, which seeks to reform global fishing subsidies; the G20-adjacent “Friends of Fossil Fuel Subsidy Reform”, or our support and advocacy for Small Island Developing States.
The final principle concerns our connections.
This refers in part to our stock of bilateral relationships.
Like any country, we must continually build and reinvest in our portfolio, placing particular weight on those partners who either share our values or long-term interests; those who are accessible and have influence; but also those that could play a spoiling role with respect to the other two categories.
The same principle applies to our trade relationships. Trading a range of goods and services across a range of markets, and securing investment from a range of sources, helps underpin New Zealand’s prosperity and insulate us from the vagaries of the international economy.
And importantly too, it means maintaining and leveraging connections at home. Foreign policy is no longer the exclusive preserve of foreign ministries. It demands a ‘network approach’ taking in all aspects of government, business, cultural and societal contributions.
Fortunately for small states, a small, agile, cohesive and responsive system is an intrinsic advantage. But we can and must do better at building and leveraging its potential.
The Trans-Tasman Relationship
Finally, one of the most critical connections recommended for small states is the importance of aligning or integrating with a larger partner or bloc.
Which of course brings me back to Australia and the trans-Tasman relationship.
Australia will undoubtedly remain our most important and influential partnership: our indispensable ally in the world. This is so much so that it goes beyond a standard international relationship and directly to all three of the principles I mentioned above.
Our shared history, values, institutions, economy, people and partnerships make us an integral part of each other’s narrative and value proposition.
We are united in our shared interest in, membership of and support for international rules and architecture. And our own world-leading bilateral ecosystem has helped underpin further integration efforts in both the Pacific and ASEAN.
And as for connections, a 2015 study by McKinsey Global Consultancy described us both as two of the most “connected” countries on the planet. It ranked us ahead of Canada and USA; Malaysia and Singapore, and even the core EU member states France and Germany.
As the McKinsey report made clear, our relationship is deeper and broader than nearly any other country, but it is also incredibly intimate.
What’s in it for ‘Oz?
Australia’s significance to a small state like New Zealand goes without saying.
But middle powers also need to think about their own portfolio of relationships. And in challenging times, the same global pressures compel them to think according to the same priorities and principles as small states.
So the question is what does Australia gain from the trans-Tasman relationship? We think quite a lot. For a start, when judged by the number of exporting firms, New Zealand is actually Australia’s number one export market. More than 18,500 Australian firms export to New Zealand, compared to 11,000 to the US and 6,000 exporting to China. This suggests we’re disproportionately important to each other’s SMEs.
And while other markets predominantly buy mineral commodities, New Zealand is still Australia’s seventh largest export market - and particularly important for high growth, high value and labour-intensive industries like pharmaceuticals, medical devices and manufactures, as well as IT and especially services.
Up until last year, when we were only just displaced by China, we were Australia’s largest source of foreign tourists.
In 2017 an estimated 128 flights a day – that’s 47,000 a year – carried nearly 7 million individual passengers back and forth across the Tasman.
Put simply, this means New Zealand underpins a lot of Australian jobs.
We’re coming closer together in population terms.
Currently nearly one in every eight New Zealanders calls Australia home. And there are also around 80,000 Australian-born people in New Zealand.
That trans-Tasman population has carried its passions with it. Our rugby, soccer, league and basketball teams all play in Australian domestic competitions. And, like Tasmania, we’re even up for an AFL team…
We eat the same merengue, cream and fruit dessert, which New Zealand invented…
And we’re even united in our mutual attempts to variously claim – and then disown – Russell Crowe.
Trans-Tasman integration is also literally paying dividends for Australia.
Australian investment in New Zealand tripled between 2000 and 2016 meaning we are now the fourth-largest destination for Australian capital, accounting for $103 billion last year.
And New Zealand also has around $45 billion invested here. That puts us on par with Canada or Germany and nearly double that of France.
Drilling below the headline stats to the enterprise level, this includes companies like Fonterra, which is now Australia’s leading foodservice and dairy ingredients provider. In Tasmania alone, it collects and exports milk from nearly half the state’s 600 dairy farms.
The same can be seen in aquaculture. In 2011, New Zealand seafood company, Sealord, invested in a 50 percent stake in Devonport’s Petuna aquaculture, one of the state’s largest premium seafood companies.
But New Zealand also adds plenty of value outside the economic sphere.
On the defence side, we are trusted and inter-operable security partners with a proven track record of working together well.
Our joint training mission in Iraq is the continuation of a century of ANZAC security efforts.
Our RNZAF aircraft and Royal New Zealand naval vessels have been used as substitutes and supplements for Australia’s own deployments; even on occasion patrolling Australia’s southern waters.
Our two defence forces have worked incredibly closely in responding to any number of humanitarian and disaster recovery efforts in the Asia-Pacific, including earlier this year in response to earthquakes in both PNG and Indonesia.
And our frontline agency collaboration has also extended to Australian police helping out in Christchurch following our worst ever natural disaster, or New Zealand firefighters battling bushfires in Australia pretty much every year for the past decade.
We’ve been each other’s first port of call – and the first to offer assistance - following major disasters and other domestic events.
When Australia hosted the G20 in Brisbane, more than 200 NZ police were deployed to Queensland and sworn in as temporary Australian police officers.
The in-depth familiarity this reflects in terms of law, doctrine, operating procedures and trust is remarkable and shows just how connected our two systems are.
The cooperation between New Zealand and Australia is so instinctive that it can be easy to forget that we are talking about two separate countries and not - as even the Australian Constitution suggests - another Australian state.
We are separate countries, with distinct identities and often different approaches, but with enduring values that are fundamentally aligned.
To many outsiders we look, sound and are the same. But a growing acknowledgment of our distinctiveness is enabling us to better complement one another on the world stage.
From 2013 to 2016, Australia and New Zealand concluded consecutive terms on the United Nations Security Council – a scenario that would have been unthinkable a decade ago.
And we are each bringing our complementary contributions to enhance our cooperation in the Pacific through Australia’s Pacific Step Up and New Zealand’s Pacific Reset strategies.
The need for states to invest in reputation and resilience at home; architecture abroad; and connections everywhere is as real today as it was for Sir James Plimsoll.
Sir James’s career provides numerous examples of his innate understanding and instinctive flair for all the fundamental roles and functions of a true diplomat.
The Australia he represented was then (as now) a middle power, but he would undoubtedly have felt the challenges of his times as acutely as any small state.
Just as in so many of his ambassadorships he would have known well what it was like to be the smaller partner.
Sir James’s legacy remains with us today in the values he embodied and defended; the connections he established; and the international architecture which he and his contemporaries helped build.
They serve as a reminder of the investment that has gone into them and the enduring need to work actively and collaboratively to preserve and reinforce them.
That imperative applies as much to the global system as it does to bilateral relationships, even between states as close as Australia and New Zealand.
For all our genuine success, we are not immune from the same trends that are eroding so many other long-standing relationships around the world.
And in challenging times, bonds like ours matter more than ever.
That’s true for great powers, middle powers and small states alike.
Thank you and tēnā koutou, tēnā koutou, tēnā koutou katoa.