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Connectivity of BRI is the Key Factor Attracting New Zealand
——An Exclusive Interview with John McKinnon, Ambassador of New Zealand to China
Pan Xinyi, China Investment
China Investment：As the 19th Congress of Communist Party has laid out, the goal of China’s foreign policiesas well the Belts and Roads will be forging new type of international relationsand a community of shared future for mankind. What is New Zealand’s take on the new philosophy of China’s global move?
John McKinnon：We are a very opensociety and an open economy. What we find positive is China being committed toan open society and a modern trading economy which is very important for NewZealand.
Different from China, we have a lot immigrants from other countries to live and work in New Zealand and that is afeature of New Zealand as a country and a society. In recent years we have more immigrants from China, India, the Philippians, Korea and many other places. NewZealand is open to the world and very engaged in the world.
China Investment：On 21st November 2014 and in his dialogue in Suva, Fiji, with leaders of the PacificIsland countries, President Xi Jinping claimed that Australia, New Zealand and the Pacific Island nations are an integral part of Asia Pacific, and there forea natural extension of the Belts and Roads to the whole region of Oceania. Inreality, however, how does this fit to New Zealand and the wider region?
John McKinnon： We are very happy to hear that and of course Belt and Road initiative has got a lot of attentione specially this year because there was a big summer meeting in Beijing in May.
Two months before that, when Premier LiKeqiang visited New Zealand, New Zealand and China signed a memorandum of the arrangement for the BRI and we spent the next a year and a half to figure out what projects we want to do.
From New Zealand’s point of view, the keyarea that we are interested in B&R initiative is because it has aconnectivity between different countries, different regions, different parts ofthe world.
New Zealand has a lot of expertise in thatarea because for us connectivity is so important that if we do not connect,nothing is going to happen.
So in terms of trade facilitation andinteraction between different economies, an area we have a lot of skills, thereis a quite degree of complementarity between what China is interested in and wants to do and the skills New Zealand has.
China Investment：New Zealandis an important aid donor to Pacific island nations and has strong bilateral and multilateral links with the region, e.g. the Pacific Agreement on Closer Economic Relations – Plus(PACER-Plus) What China can interact further with all the stake-holders in there gion? What we can do together?
John McKinnon：The pacific area isvery close to New Zealand and very important. There are many pacific islander snow living in New Zealand.
From New Zealand's point of view, pacificarea is very important. At the same time it is becoming increasingly important for China .
Wefind it very useful and helpful to have dialogue with China about what is happening in pacific. One very practical project we have been doing is what happening on Cook Islands where China, New Zealand and Cook Islands cooperated together to do water quality and water supply.
Pacific is the area we are mostly activeand it will be something we require to do more. We think that we should do more with China in the future because we see China’s presence on the pacific assomething welcomed by the pacific countries and China’s interest in the part ofthe world is continuing.
From New Zealand's prospect, it is important to have channels of communication that can link us and the pacific together with China.
China Investment：Occasionalfriction can be seen between New Zealand and China. Is that primarily because the side effects of ANZUS or the role of NZ as one of the “Five Eyes”?
John McKinnon：New Zealand and China have different approaches on the way we organize politics or the way ween force our laws, which means we may have some points we are agree or other points disagree.
That has been the practice of there lationship between China and New Zealand for a very long time. Whoever the two countries are, there will be always differences between them.
Despite those disagreements, we have very constructive relationship. Agreements or disagreements, with those we can always find ways of dealing.
China has become a more important partner.The investment and effort we make to sustain that relationship is correspondingly greater. We still recognize we are different countries and were late to each other in spite of that fact.
China Investment：New Zealand has been traditionally a trading nation with the great potential yet to betapped, by far, of land area of 270,534 and population of 4.7 million. Productsof dairy, meat, forestry and wool are readily welcome in market places allacross China. What particular lines of business or sectors of the economy are expected to access of Chinese investment for the fo reseeable future?
John McKinnon：The relationship between New Zealand and China has been significantly developed since 1972 andespecially since 2008 when New Zealand became the first developed country which signed a free trade agreement with China.
Interestingly, I came across a report written by the first New Zealand ambassador to China. In the report he saidwhile China and New Zealand did not establish diplomatic relations because of trade, he believed that in a while China may become one of the important trading partners of New Zealand. He had no conception that 45 years on China would be our first tradepartner. Nobody had that expectation.
Not only FTA is very significant providinga platform for the expansion of the trade, but also the communication between the two countries.
As you see, the demand from China for goodsand some services produced by New Zealand has increasingly risen as New Zealand’sability to supply those needs has continued to expand, which has always been as ignificant component to our relationship.
Meanwhile we are upgrading the free trade agreement because we hope it can fit the purpose of both sides, from which wecan tell the business sectors and activities that are most likely to be taking place. I believe creative industry will be one of the most promising sectorssince we now have a number of activities related to it.
Aweek before, I was in Zhejiang attending a conference organized by AucklandUniversity who established an institution in the Hangzhou economic development area and held a conference to introduce New Zealand, particularly AucklandUniversity. On the meeting researchers and scientists from New Zealand introduced their work to Chinese scientists and Chinese investors.
Presentations about quite specialized field were shown and I found that there are probably a lot of thinking of innovationin New Zealand and a lot of interests in China.
There are some social economic challenges of which the scale may be different but the two countries are facing similarproblems, such as aging population. This may lead New Zealand and China to cooperate in the areas of innovation and technology. In fact, we have already seen a lot of collaboration expanding in this area. New Zealand is quiteskilled in software developments and Chinese business may find investment potential in this field.
Despite our expectations of cooperation between the two countries, it is always the smart money deciding the directionof investments, which means Chinese investments in New Zealand dedicated to what profitable. Chinese investments are rather welcomed in New Zealand. As youmentioned, New Zealand is a country with a lot of potential with a large landalmost the size of Japan and the population of four and half million.
As the key part of New Zealand's economy,the development of rural sector has significant status, and the development of agriculture probably is the first thought in people’s mind. Many Chinese business has opened gate to New Zealand’s agriculture and livestock products.New Zealand merchants want to seize the opportunity and be associated with inthe area.
Service economy is actually the largestpart of New Zealand’s economy now. The number of tourists from China going to visit New Zealand is increasing continuously. Obviously, there exists the need to develop tourism industry, e.g. infrastructure required for hotels and other services.
In addition to these, there are other areassuch as healthcare and waste management that had already gained investments from Chinese companies. To some extent, a broad area and categories that will appeal to the interest of Chinese investors.