ASIA

New Zealand's well-being is tied to the economies of Asia

• The growth of New Zealand's economic and trade relationship with countries in the Asia-Pacific has reshaped the balance of our global economic and trade interests. Our major trading partners are now in the Asia-Pacific. Five of the top ten are in North Asia. Those relationships are now mature trading relationships, and the long-term prospects are good.

• Maintaining and improving access to those markets is an important part of our diplomatic and trade effort in the region (including for example the negotiations on possible closer economic partnerships) and multilaterally in the WTO.

• Trade in services has become significant in these increasingly affluent markets. Sale of education and tourism services to Asian countries is a driver in the growth of these sectors in New Zealand.

• Growth in migration from Asian countries in recent years has added a new dimension to our relations with the region.

We need to engage with a wide range of Asian countries across a broad front

• New Zealand's small size, cultural traditions and geographical position on the margins of Asia mean we have to try hard to develop constituencies and maintain relevance for our larger Asian neighbours.

• For a trading nation like New Zealand, economic links must be underpinned by political ties. Exchanges of visits between political leaders are important, supported by regular contact between officials. Closer relationships bring with them a greater degree of frankness in our exchanges with these countries including on sometimes sensitive topics such as human rights and the environment.

• The efforts undertaken in Asian markets by New Zealand's commercial interests, and growing links between academic and other non-governmental institutions are also important.

The stability of the Asia-Pacific region is crucial for New Zealand's well-being

• Asia is an area where key global players are closely engaged. The nature of their engagement will have a bearing on key New Zealand foreign and trade policy interests.

• Conflict in the Asia-Pacific region runs counter to our interests. It has the potential to disrupt trade and depress demand in some of our key markets. Unimpeded passage through the region's shipping lanes and air routes is crucial to the smooth conduct of trade and commerce. Regional conflicts can also create destabilising refugee flows.

The region is basically stable, but there is potential for trouble

• Relations between the major players in North Asia are stable thanks to close engagement between Japan, China and the US. This allows periodic ups and downs in those relationships to be managed. China's continuing growth, driven by a strategic decision to open up its border, will be a critical factor in the future regional dynamic.

• In Southeast Asia, ASEAN was shaken by the financial and economic crisis, but recovery is well under way. ASEAN is evolving, dealing with upheavals in Indonesia, and establishing a modus vivendi with China. It remains to be seen whether the ASEANs will decide to pursue a strategic trade and economic relationship with CER (the AFTA-CER initiative).

• There are a number of trouble spots in the region, any of which could flare up and destabilise the regional and in some cases the global security situation. The obvious areas of risk are the Korean Peninsula, Taiwan/China, the South China Sea and South Asia. Conflict in any of these areas would affect important New Zealand interests.

Regional frameworks are important, including for the handling of security issues

• Bilateral links continue to dominate intra-state contact in this large and diverse region. But a regional architecture is being developed to deal with economic, political, defence and security, social and environmental issues in the region and between the region and other parts of the world (APEC, the mooted trade agreement between the CER countries and ASEAN, the ASEAN Regional Forum, the Asia-Europe meeting (ASEM), and the East Asia-Latin America Forum). This architecture does not yet work effectively to resolve conflict.

• New Zealand is an active participant in most of these regional and multilateral processes. We have to work hard at ensuring that we continue to play a positive and relevant role in regional affairs. We must ensure that our involvement continues to be welcome.

New Zealand defence and security policy in the Asia-Pacific context

New Zealand has a large stake in the stability of the region

• New Zealand has large commercial and political interests in Asia. Future trade prospects depend on continued economic growth which in turn requires confidence in a stable regional security environment.

• The scale of New Zealand's interests in Asia argues that we should do what we can for the stability of the region. We are not a large player. But we have been part of the regional picture over a long period. We are a member of the major regional institutions. We have treaty links with some Asian countries. We have a good regional network and good standing.

Our main focus will be regional processes and institutions

• Regional processes such as APEC and the ASEAN Regional Forum (ARF) are a relatively new phenomenon in the Asia-Pacific region. They have had an important role in developing a post-Cold War modus vivendi for the larger regional states, particularly in establishing the habit of getting together at a senior political level on a routine basis. These institutions do not, however, have a guaranteed future: to keep the larger members engaged they need to produce results, and sensitive underlying issues (eg Taiwan) need to be managed. APEC in 1999 was one illustration of the way New Zealand can add value in such forums. A multilateral security framework is an important tool for regional stability

• The multilateral process is important for small countries such as New Zealand. The ASEAN Regional Forum (ARF) was set up in 1993 to provide a forum for working on problems that could threaten regional stability. New Zealand is an active participant. The ARF has concentrated on confidence-building measures designed to reduce tension through better understanding of others' capabilities and intentions. There is scope for the ARF's role to be expanded.

• Many Asian countries see the United States' military presence as central to the continuing stability of the Asia-Pacific region. For its part the US is clearly looking to other countries in the region to play their part in the larger task of maintaining regional security.

• The country with which our regional interests are most closely aligned, and the habit of consultation most highly developed, is Australia. In terms of diplomatic influence a concerted effort on the part of Australia and New Zealand carries greater weight than can be achieved by either on its own. And the resources Australia can bring to bear considerably exceed New Zealand's.
• We and the Australians will not always take an identical approach. The Australians tend to view the Asia-Pacific region in balance of power terms (as do many Asian states). The Australians sees themselves as a regional power with military capabilities that are significant in regional terms. They will continue to develop their maritime capabilities in line with this view of their interests and role.

There is value for us in maintaining a network of military links in the region

• We already have strong military links with Singapore and Malaysia through the FPDA. The FPDA is a practical demonstration of New Zealand's commitment to regional stability. New Zealand and Australian involvement is appreciated by regional members of the FPDA.

• There are military links with Thailand, the Philippines and Indonesia (although the latter remain suspended in the wake of last year's events in East Timor). And we are developing a defence dimension to relationships with China, Japan and Korea. China is a significant factor in the security of the region and it is important to gain some understanding of the Chinese military establishment and its approach to the region. Developing these links is consistent with our emphasis on regional confidence building.

New Zealand defence resources would not be particularly relevant to any major conflict

• The capabilities we can maintain at current funding levels will not be a major factor in regional military calculations. New Zealand capabilities and activities will nevertheless be useful in the context of some regional defence relationships (eg FPDA) and processes (such as the ASEAN Regional Forum). They underline the scale of our interests in the region. And they will continue to signal our wider commitment to collective efforts to maintain peace and security.

But we could be expected to participate in regional crisis management

• It is likely that occasions will again arise (as with Timor) when we shall be asked to contribute to crisis management, peacekeeping or other multilateral operations in the region. New Zealand has demonstrated its preparedness to participate in operations to keep the peace in this part of the world, most recently in Bougainville and East Timor. Some general principles apply to such deployments. New Zealand is most likely to participate where there is:
  • a request for assistance from the government concerned

  • explicit United Nations authority, and an appropriate mandate

  • participation by other like-minded countries

  • a peacekeeping role, rather than a requirement to impose peace.

For such regional tasks we would rely on capabilities developed for wider multilateral roles

• For any lesser role we undertake in the region we shall need to draw on capabilities we have developed as a basis for our contribution to wider collective security effort under UN auspices. Our special interests in Asia will therefore be reflected mainly in the form of our defence and security relationships (eg in FPDA and ARF, and in bilateral defence relationships, particularly with Australia) rather than through capabilities developed specifically for a role in the region. Although we cannot rule out the possibility that New Zealand would face a decision to commit forces to a combat role in Asia it is not easy to envisage a situation in which this would occur. This limits the value of scenarios involving war in Asia as a point of reference for the development of NZDF force structure.

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