Speech – New Zealand First Party

Thank you for inviting me to speak to you tonight and for your interest in international affairs. Lets start by saying something reasonably obvious, which is that with some exceptions, New Zealand foreign policy is by and large a pretty bipartisan affair.Rt Hon Winston Peters

New Zealand First Leader

8 November 2013

Nelson Branch, NZ Institute of International Affairs
Nelson Marlborough Institute of Technology, Nelson
Thursday 7 November 2013, 5.30pm

BIG GLOBAL CHALLENGES: HOW WE ARE FARING AND WHAT ELSE WE SHOULD BE DOING

Thank you for inviting me to speak to you tonight and for your interest in international affairs.

Let’s start by saying something reasonably obvious, which is that with some exceptions, New Zealand foreign policy is by and large a pretty bipartisan affair.

This is how it should be. We should be strong believers in conducting our relations with the world as a country rather than with too much of the obvious “politics” that infest our domestic affairs.

We do have differences of course but these should be more about relative priorities and emphasis than fundamental disagreements. So, don’t expect too many fireworks from the following comments this evening!

What we need to talk about is some of the big challenges out there in the world and how we are dealing with them.  One can’t cover off every nook and cranny of what is going on in the world nor comment upon every aspect of our engagement with the world.

Now, just recently you would have read that our Secretary to the Treasury, Gabriel Makhlouf, made headlines when he said as follows: “The world is more and more complicated, more volatile and changing faster than ever before.  But I also believe this is a fantastic moment in time for our country”.

By nature many of us are positive people, much more inclined to see the brighter side of life than the alternatives.  And we very much hope that Gabriel is the smartest guy ever to hold that position and that he turns out to be 100% correct!

But one has to admit doing a double-take when reading his statement. Let’s fully agree with the first part – the world is certainly more complicated, more volatile and changing quicker than ever before. But the last bit was cause for consternation.

When we look at the world we would be the first to acknowledge that, at least in comparison with many others, we are doing better, though at the same time we know that we ought to be doing better than we are.

Because there are some underlying trends that give one pause, and to wonder if the current Government and the policy establishment in Wellington aren’t at risk of complacency: complacency because they are starting to believe all their own positive rhetoric and propaganda.  Pride comes before a fall?  They would not be the only second term government to meet this fate.

It is of concern, for example, that we are clearly in a period where the UN and multilateralism more generally seem to be failing.  As a small country dependent on broadly (if not universally) understood norms and rules for international behaviour this should worry us all. 

What should we make of the Security Council’s inability to act in response to the terror inflicted on the people of Syria?  What message does it send to other erstwhile despots and tyrants – that you can now use weapons of mass destruction without too much fear of the consequences? 

The Security Council, dominated as it is by the Permanent 5 is unrepresentative, unresponsive and clearly needs a major overhaul.  We all hope we can take John Key at his word when he said recently in New York that we were not campaigning for a seat simply to fill up the space.

But it is not just the Security Council.  The WTO seems as dead as the proverbial dormouse: probably beyond resuscitating in any meaningful way.  And the global community seems equally unable to deal with that other big international challenge: climate change. 

So on big questions of security, trade/economics and the environment the international “system” is not coping too well.  What this all seems to add up to is that some of the systems, institutions and rules that have guided the conduct of international relations since 1945 are looking decidedly shaky.  And it is not at all clear what will take their place. There are tentative efforts to look at different architecture. 

We had the G20 for a while but that seems to have fizzed somewhat of late.  Regionally we have things like APEC and the East Asian Summit but it is far from clear what these processes will amount to.

The really scary scenario is that nothing will adequately replace existing institutions and structures, or that the current ones limp forlornly forward and we will revert to a world order where the big boys do what they want according to their own self-interest and for the rest it’s a question of the devil will take the hindmost.

And what of the big boys?  Let’s look at the big two. Well there again, things are changing by the month, by the week and by the day. Of course there are opportunities but let us not blind ourselves to the risks.

The US seems to be entering a more diffident phase around its engagement with the world. Its domestic politics are fractured to say the least and seem unlikely to improve anytime soon.  Its economy, while still strong by any international measure, faces deeply-rooted and difficult challenges.  And the US is just coming out of two major wars in the Middle East.

It seems to be entering a more inwards looking phase. Not wanting to over-cook the idea but coming on the back of the US determination to play a back seat role in Libya one had to be struck, for example, by the US’s decision to shy away from action in Syria. 

Many wonder whether it means we might be witnessing the beginning of the end of what Madeleine Albright called the US’s “indispensable” role in the world – in other words the willingness to lead?

At one level one can understand the reasons for the US decision. And there is no disagreement that Syria is a very poisonous and dangerous place – and that for as long as the conflict continues more and more extremists from outside are infecting the so-called Syrian rebels.  Nothing is clear-cut there. 

But the fact remains that weapons of mass destruction were used on the people of Syria – only the second time as far as we know (after Saddam Hussein) since the world banned such weapons after WW1 that chemical weapons have been used and it seems unlikely that anyone will be held accountable.  It is a horrifying precedent. (We should note that while we welcome the in-principle decisions to remove chemical weapons from Syria it seems that at a practical level implementation will be fraught with difficulty.)

The US is still the only super-power.  It is still the only country capable of exercising global leadership.  But whether, going forward, it still has the resolve to exercise that leadership as it has in the past (not always successfully!!) is going to be something we should all watch closely.  Of course there will be many who would welcome such a lack of resolve.  I am not one of them.  I hope I’m wrong!

On the other hand we are witnessing the rise of China.  As Churchill forebode, one day inevitable.  Who could not be impressed with China’s recent progress?  It is a stunning story.  Lifting millions out of poverty and hopefully changing the country forever and for the better. 

The point here is not to underestimate what China has achieved but to note that China’s rise is inevitably impacting on the way the world interacts and it is not without risks.  The international system is in a state of flux.  The US-China relationship remains crucial and there are many positives not least the level of economic interdependence between the two. But that should not mask the underlying strategic rivalry.  This rivalry is playing itself out across Asia with unpredictable consequences. 

That is not to predict a clash but there are enough existing flash points (the South China Sea, the territorial island disputes between Japan and China, North Korea, etc) as to make management of China’s peaceful inclusion in regional and world affairs of absolute importance.

And whenever one reads about China one is always reminded of Japan in the 1980s.  You will remember all the stories about the rise of Japan; Japan buying up iconic American properties; the Japanese century etc etc.  Well we all know it didn’t happen.  And while we should all be excited about the opportunities China’s rise presents we should not forget the risks. 

China faces its own enormous internal challenges and if anyone thinks that China will continue to grow at the pace it has then they should remember Japan’s fate over the last two decades.  Faltering economic growth and growing internal challenges mean that the picture we have of China today could change quickly and unexpectedly and not for the better. 

And without belabouring the point Japan never had the offensive military capability which China is rapidly acquiring.  And if developments in China are not as rosy as most commentary currently suggests, the effects will be felt most immediately throughout North and Southeast Asia before affecting us all.

We also have a ways to go in dealing with the Global Financial crisis. Europe is still in the midst of it and will take a long time to emerge again.  But everyone else remains vulnerable.  Just witness the global handwringing over the recent risk of a self-induced US debt default.

It’s pretty clear that the sense of crisis which drove the formation of the G20 and concerted collective action to address the crisis has evaporated and it’s pretty much everyone doing their own thing.  We are not out of the woods.

One could go on here to talk about terrorism, the dismal events happening in the Middle East, the even more dismal evils happening in the Sahal region of West Africa (Mali, Niger, Mauritania, Gambia and a few others) on which we will hear more in future because failed states there could become a new home for international terrorism.  But you probably get the drift.  As said at the start one hopes Gabriel is right.  But politicians and policy makers ought to be planning for the worst.

What should we be doing?

In my time as Minister of Foreign Affairs I came to have a high regard for the dedication, experience and commitment of the staff in the Ministry.  I saw them as our front line and I fought to get them more resources – more people, a few more posts and more ODA (more on the latter in a minute). 

We managed to get the single biggest increase in the Ministry’s budget ever.  That has all now been undone and one watches in disbelief as the Government has gone about wrecking the place.  If you seriously believe the world is more complicated, more volatile and changing quicker than ever before why on earth would you basically dismantle the one institution of state capable of responding. 

Can we as a country blithely afford to shove so much experience and talent out the door – while, at the same time, shovelling millions of dollars to the consulting community.
It simply doesn’t matter how often the current Ministry mandarins tell us the new Ministry is giving us an edge internationally.  That is hogwash.  What they did was get rid of a lot of darned good people then go out and employ a whole bunch of new people with no experience whatsoever.  So we must quickly rebuild the Ministry. 

If I had my way I would go looking for some of those talented people who had to leave and I would also look to draw on the pool of talent that resides amongst former Ministry people who had retired.  I would be saying “We need you.  Want to help?”  Experience matters.

It is not just Foreign Affairs however.  Primary Industries was also done over and only after a series of debacles has it been acknowledged that they got it wrong.  They are now having to go back and fix it.  Fixing our machinery of government must be a top priority so that we can respond both to the opportunities and challenges that confront us.

In times of change and uncertainty we need to ask constantly if we are managing our relationships to best affect.  Are we sure we know who are friends are?  Do we act accordingly?  For example, in my time as Minister, under the old rotating EU presidency I used to get to Europe at least twice a year for consultations.  That is harder under the new Lisbon Treaty arrangements but frankly I am appalled when we have Ministers musing in public about dismantling our European network, about closing Stockholm, Warsaw, Rome, Madrid and The Hague and shifting resources to Asia.  How does one justify closing down Stockholm and opening up in Barbados?

By history, by values, by our shared commitment to democracy, human rights and the rule of law the countries of the EU are our natural partners and friends and we should not forget that – and we should not let them forget it either.  Sure, they are going through tough times and Asia is doing much better but the day might come when friendship counts and we need to guard against that day.  So, let us not forget the “values” component of our international links.  Yes we have to prosper economically in the world.  But we also stand for something in the world.  We need our friends.

In a related vein one might understand why with the collapse of the Doha Round and general dysfunction of the WTO we should try to pursue other opportunities.  But why oh why are we negotiating an FTA with Kazakhstan and Belarus?  What sort of message does that send about what we stand for?  Maybe an FTA with North Korea next and Zimbabwe shortly thereafter.

And there are real concerns about the TPP (Trans Pacific Partnership) though of a different kind.  In the previous GATT/WTO rounds of trade negotiations there was thought to be a trade off in that everyone got enough in the overall package to satisfy their domestic lobbies and that compensated for the areas they had to open up to more trade.  Are we sure the same calculation applies in regional deals.  What concerns me here is what we will have to give up to secure a TPP.  What is the price??  We simply don’t know yet. 

But if you look at it coldly you would say, great if we can get more dairy products into the US, Japan and Canada.  But those countries have been massively protecting their dairy industries for decades.  Are they really willing on this occasion to put those industries on the negotiating table when they have not been willing to do so in the past?  And if they are, what exactly are they asking us for in return?  The devil will be in the detail and we should be looking at the detail with a fine tooth comb!

So there are some ideas from the opposition benches.  Fix the Ministry of Foreign Affairs and try to attract back experience and talent that we need and which has been let go, including those who have retired.  Look at the wider machinery of government too so that we can move forward with some confidence that it has the skills and experience we need. 

Make sure we know who our friends are and make sure we are not neglecting them, especially in Europe, where we have been sending mixed messages of late.  Rebalance our trade policy and set it in the wider context of what we stand for and what we – all New Zealanders – hold dear.  There is more to New Zealand than the dairy industry, crucial though it is.

We need to get it right in the Pacific because they are our friends and neighbours.  It is important that our region prospers. It is vital that decent government and sustainable economic development touch everyone who is a part of our wider family.

We will not be immune if we don’t do a good enough job.  We simply cannot afford to have a bunch of failing or failed states in our neighbourhood with all the risks to us that follow – corruption, transnational criminal syndicates, drugs/money laundering/people smuggling and even the risk of those countries being used by extremists of one kind of another.

And if we screw it up it our own neighbourhood then how will we be able to speak with much, if any, credibility about moves elsewhere in the world either. If we cannot get this right why would anyone listen to us??

So, enlightened self-interest:  Match what we want and hope for in the Pacific with a dollop of self-interest and do better.

And though it’s now probably forgotten, it is a matter of record that in my last year as Foreign Minister our ODA programme, as a percentage of Gross national Income (GNI) reached 0.3% – a level which has for decades never been bettered.  The trend of the last few years has been going backwards.  Now we have all been through a tough few years in the international economy but is that sufficient excuse.  We ought to be doing better.  And when you look at what is going on the case is compelling.

I don’t know about you but I was shocked by the UN finding that the only region in the world doing worse than the Pacific in reaching Millennium Development Goals (MDGS) is Sub-Sahara Africa.  That is a sobering statistic.

There are some positives.  There is good news in the Cooks, Tonga, Samoa and Niue.  They all seem on track to meet a majority of MDG goals.  And that is important not only for those countries but as an important message that Pacific Island countries can succeed and can do well. 

But when you look at the performance elsewhere – in PNG, FSM, Kiribati, Nauru, Vanuatu and Fiji – the outlook is grim.  They will be lucky to reach or 2 or 3 of the 8 MDG goals.  They are not doing well.

So my view is that in a measured, gradual and serious way we should set about aiming to get our ODA programme to 0.7% of GNI over time.  We should aim high.  It is in our best interest and in the best interest of our closest neighbours and mates. 

And we should do so in close coordination with Australia and with the EU – which is big and influential donor in our region, though it is often overlooked.  We should also make sure we understand China’s ever growing presence in the region and what it means – a deeper dialogue there should be a priority.  We must step up our game – we have not been doing so of late and that’s not good enough.

That is the serious message of this address which we all need to share with as many New Zealanders as possible.

ENDS

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