New Zealand and Australia: Asian decoupling

Malcolm Cook is the Program Director for East Asia at the Lowy Institute in Sydney. This opinion piece was published in the Dominion Post on 1 June 2010. It is based on the Outlook 13 report that Dr Cook wrote for Asia:NZ.

Real world diplomacy often mirrors football diplomacy. There is no better example of this than the FIFA World Cup.

Last week, New Zealand and Australia played a football match in Melbourne. At first glance, this was no watershed. New Zealand and Australia have fought many a sporting battle. This match though was a sign of a significant change, and one that extends far beyond the playing pitch. Rather than fighting to represent Oceania in the World Cup, the All Whites and Soceroos are going to South Africa; New Zealand representing Oceania, Australia representing Asia.

Since birth, New Zealand and Australia have shared a compulsion to be accepted by Asia and the fear of isolation in the South Pacific. Likewise, many countries have coupled the trans-Tasman duo when it comes to their perceived role in Asia. Only last year, New Zealand and Australiia signed together a preferential trade agreement with ASEAN. Forty-four years ago, both became founding Asian members of the Asian Development Bank. In 1951, both signed onto the ANZUS alliance, Washington’s only trilateral alliance in the Western Pacific.

Four powerful dynamics are decoupling New Zealand and Australia in Asia. Closest to home, the deep problems of the South Pacific are requiring even more resources from and collaboration between Wellington and Canberra. Australia led and was the largest contributor to the INTERFET mission in East Timor. New Zealand was the second largest contributor, one that amounted to its largest military contribution since the Korean War. Today, both countries are leading international efforts against the coup in Fiji. Reflecting these South Pacific ties, Australia’s 2009 defence white paper covers New Zealand just before the South Pacific but only after discussing the alliance with the United States, the Asia-Pacific and Southeast Asia.

Second, New Zealand’s ANZUS politics and its very limited force projection capabilities are shutting Wellington out of some of the most important strategic developments in East Asia. In 2007, Australia signed a joint security declaration with Japan, bolstered by the signing last week of a defence logistics treaty at the annual 2+2 meeting between the two countries’ Foreign Affairs and Defence Ministers. In 2008, Canberra signed a similar, if weaker, declaration with South Korea and, in 2009, with India. These support the annual ministerial meeting of the Trilateral Strategic Dialogue between Australia, Japan and the United States. At the operational level, Australia’s decision to purchase Aegis-equipped destroyers along with Japan and South Korea will further integrate Australia into the Pentagon’s regional plans. Australia is playing a new game in Asia. One that New Zealand does not have the equipment to join.   

The growing importance of Asia to New Zealand and Australia’s economic futures is driving diplomatic competition more than cooperation. The agreement with ASEAN may be the exception. Australia’s huge natural resources’ reserves and its much greater economic integration with Asia should put Canberra on the front foot. Yet when it comes to Asia’s only two billion + people markets, Wellington is ahead. New Zealand has already signed a trade deal with China to the joy of its wine producers. Canberra is still mired in seemingly endless negotiations. Wellington is also further ahead on talks with India despite India being Australia’s fourth largest export market while not breaking into New Zealand’s top ten. When it comes to Japan, Canberra is again stuck in seemingly endless negotiations. Wellington though is still pleading with Tokyo to even start talks.

Finally, the emerging post-Cold War global and regional order is one that, unsurprisingly, again favours the interests of major powers, largely ignores those of small powers and leaves self-described middle powers like Australia grasping for opportunities to join the major powers. The creation of the G-20 after the Asian Financial Crisis and its elevation to the premiere global economic body during the Global Financial Crisis is the strongest institutional example of this. Australia is in and very keen. New Zealand, Singapore and others are clearly only looking in. If the push from some in Australia for an East Asian caucus within the G-20 bears fruit then Australia’s gain globally will be transferred regionally.

It is a good that both countries can now qualify for FIFA World Cups. However, this is only because Australia is now playing and winning in Asia without New Zealand.

Related pages:

• Outlook 13 main feature and full report