Navigating the new normal

It is apparent that the ‘Indo Pacific’ means different things to different partners. For some countries, it is a logical description of their geography; others see it through a defense prism; others contextualize it with the rise of
India and its increased integration with the region; some see it as a competing construct to the likes of the Belt and Road Initiative.

The technical diplomatic term for this is I believe, ’constructive ambiguity’.After Friday, we’re a little clearer on how the New Zealand Government will be framing up its response, as it engages with key partners in the region. This is a welcome step. It’s a conscious and considered choice to use Asia Pacific over Indo-Pacific, as I see it. I suspect our Indian colleagues will be disappointed by this. How they react will be interesting. I thought the relative absence of China in the speech also noteworthy – I understand the Chinese are a bit confused by that.

On Belt and Road – Alan Bollard sees it as a way to lower production costs away from expensive coastal cities in China. I see it as a predominantly political security project; where China is intending to shake off the last 200 years of history/anomaly (a blip) and reassert itself as the dominant global power. At its core it is a spoke and hub arrangement, and this means not great for small countries with limited leverage – like New Zealand.

The benefits of ‘constructive ambiguity’

It’s nothing new that there is a re-distribution of regional power – we’ve seen this happening for a while now – not only a shift of power towards Asia, but also within Asia.

What’s important is how we want to position ourselves throughout this process.

And while the title of my presentation refers to navigating the new normal and managing the shifting dynamics, I don’t want to make the mistake of saying we’re unique in this period. Far from it.

Like many in the region we see the global geo-strategic environment as ‘more complex’ at the moment. And we see existing architecture being stressed. Particularly so in the Asia Pacific.

We see the re-emergence of China, with more activity throughout the region, including the South Pacific. But there are other important actors, too.

We look at how ASEAN countries, Australia, and others are dealing with this – some pushed and pulled more than they would like.

The US Presidents use of twitter certainly adds to a surprising and often confusing read of how the USA is responding to world affairs.

It’s quite a departure from previous administrations, where there was a sense of clarity and reassurance on what the US role in the region was.

As an aside - I do think a valid question to ask is ‘Is what we’re seeing now just a temporary aberration? Is it something that will last perhaps one or two terms, or ‘is perhaps that we have exited a period of remarkable stability in the
region? '

That perhaps in this part of the world at least the last 30-40 yeas have been the aberration.

When I look at what is happening around us now, a student of history might say, what we’re going through in this current period seems a lot like the late 1970s. For those of you who weren’t around then, there were some very familiar themes back in the day (Ack Rob Ayson):

The USA was tired from its war in Vietnam. And politically Washington had gone through its fair share of turbulence and uncertainty with Nixon and Watergate earlier in the decade. The Soviet Union was at the apex of its military and influential might.

In the late 1970’s terrorism wasn’t an unfamiliar term, either. headlines back in the 70’s were peppered with stories about the IRA, bader meinhoff, red brigade, hi-jackings and hostage rescue situations like Entebbe in Uganda.

The United Nations SC was stuck on getting resolutions over the line, with the P5 – in particular USSR and USA exercising their veto power tit-for-tat.

And we came of those times ok, so why not now? There is certainly a lack of optimism around. I say this as someone who inevitably errs on the side of melancholy.

What we do know people fear change. It is in our DNA. But it is not a good foundation for action. And perhaps that is the greatest achievement of past generations, the ability to act with a sense of genorosity and optimism.

We should be careful not to project our own fears here. Nor make them self fulfilling prophecies. Indeed, ASEAN countries have had to navigate changing power dynamics some decades and they have some unique and useful perspectives on their relationships in the region, and with China in particular.

We have much to learn from them, and be more deliberate in how we learn from others. New Zealand diplomacy in the region should, I believe, be in a bit more receive rather than transmit mode.

Let me turn now to New Zealand. I will make some sweeping, but I hope largely accurate, generalizations about the theme based on the notion of ‘where you stand is where you sit.’ Recognising that our context influences how we see the world and how we act.

In New Zealand where we stand, we look north and see a vast expanse of water and some small islands, we look west and we see Australia, to the south an uninhabited Antarctica and to the east – nothing pretty much.

To fly to our nearest neighbour is over 3 hours. Friends outside of New Zealand find this difficult to fathom. For us, it is normal.

We are the last significant landmass inhabited by people. A country of 4.6 million migrants, with Westminster institutions, a large Polynesian diaspora and claiming now one of the most ethnically diverse large cities in the world with Auckland.

Auckland has some 200 different ethnicities and 44% of its population born overseas. New Zealand is a country in a state of demographic change. Our region in one of mainly economic change.

In New Zealand our security lens is, to this day, still predominately informed by WWI, WWII and our past alliances with England, the United States and Australia.

Very unusually New Zealand has never been at war with a neighbor.

New Zealand is a founding member of the UN, WTO and the OECD. When people refer to ‘the West’ they mean countries like New Zealand. – yes Alan that euro centricity again!

We have articulated for a number of years that we live in a benign strategic environment. Yet now we are in a part of the world that is now being more contested by the two-great economic and military powers of the time – China and the United States.

I would propose that in navigating our way through the probability of increased tensions New Zealand’s instinct or ‘muscle memory’ will look to Australia and the United States in the first instance. Now that is contestable.
I know my muscle memory does.

Also note I say, ‘look to’ not ‘follow’ – these are different things which are an important distinction.
Language, values, and shared history make those countries more natural partners in a reflexive sense for us. We think we ‘know’ that part of the world best.

So, with that context for New Zealand’s part, from where we stand, let me share some observations.

Certainly, the behavior of the United States is perplexing us – we simply don’t have a good read. What we know is we are not alone in this – none of our partners are reporting much success in getting coherency out of Washington.

One consistent theme from Washington though; democrat/republican, academic, economic, military – is the union of voices critical of China. It is the one bipartisan issue at the moment.

It has been put to New Zealand for a number of years that at some time or other New Zealand will have to ‘choose’ – implicitly meaning between the US and China. Neither China nor the US have said this to us directly but some of the Track II community has.

This is a shock for a country with its geographic distance, and that has for a long time rightfully considered its strategic environment as ‘benign’.

Our response has been generally this is a false dichotomy – it is not necessary to choose, rather to navigate our way so that we don’t have to choose. In essence this means living with grey, or constructive ambiguity, which as a sweeping generalization is something New Zealanders don’t like doing.

We prefer clarity, we prefer black and white.

My own sense is that the thought of having to make a ‘choice’ is deeply troubling for New Zealand policy thinkers, and politicians. We have hugely significant equities in both these relationships. But the thought that we might actually have to make one, worries us deeply.

And I don’t think there is a commonality yet of view between our politicians, the public and the bureaucracy.

It is notable to see in New Zealand our policy thinkers are moving from a discussion of ‘balance of power’ to ‘balance of partners’. The diplomatic directive is to ‘create more choices’. This is something that ASEAN has managed successfully for decades. The trouble with ‘more choices’ though is you still often have to make one.

So New Zealand is looking at who are ‘like-minded’ – and whilst historically this may have meant; liberal values, open economy it will likely include ‘countries It is notable to see in New Zealand our policy thinkers are moving from a discussion of ‘balance of power’ to ‘balance of partners’.

The diplomatic directive is to ‘create more choices’. This is something that ASEAN has managed successfully for decades. The trouble with ‘more choices’ though is you still often have to make one.

So New Zealand is looking at who are ‘like-minded’ – and whilst historically this may have meant; liberal values, open economy it will likely include ‘countries having to navigate more thoughtfully the China and US relationships’. This means ASEAN. I think some of the smaller countries in Europe will also be.

Additionally, apart from the obvious concern of a military or far reaching economic confrontation between the two great powers – almost more concerning for New Zealand is the undermining of the post WWII rules based system.

In part this is because we are invested as a part architect of that system. That is true, but far from the totality of our concerns.

When we engage with our partners, we do so with a strong sense of commitment to multilateralism. Not, I would argue, because it’s a nice thing to do – (though that is the political rhetoric – being a ‘good’ international citizen), but because it’s in our self-interest to advance our economic, political and defense objectives in concert with others.

Having benefited from the international rules-based order, as others have too - we need to preserve what we have, and sure adapt it for the new situation, and find others as friends and partners to be there with us in supporting all of this for the common good. But not simply abandon it.

A strong ASEAN, APEC, ARF or EAS are all in New Zealand’s interests. These are forums that puts both great powers and the rest of us in the same room.

We accept that the rules based institutions like UNSC, WTO, IMF need to adapt to the power realities of 2018. But what we don’t accept, can’t accept is that they are broken beyond repair.

And it is not just about post WW2 architecture – also about how we shape the next generation of rules….what does it mean for rules around emerging but consequential issues like AI/cyber/nanotechnology – these are all consequential security issues and these rules are only just being drafted, if at all…..

And once rules are gone, the institutions undermined, it is hard to see how they could come back. The multilateral institutions were set up in an environment none of us should want to see again.

It is useful to recall the very first opening words of the UN Charter THE peak multilateral body.

We the peoples of the United Nations determined to save succeeding generations from the scourge of war, which twice in our lifetime has brought untold sorrow to mankind

I would argue that as a default setting New Zealand tends to want to always be inside the tent with regional organisations from the beginning – in large part because we recognise if we are not in at the beginning it is hard to get in latter.

The Mexican saying ‘If not at the table, then you are on the menu’. So that is what we did with the AIIB and BRI memorandum – recalling on the AIIB we were criticized by ‘friends’ for joining originally.

A limiter on our appetite for joining ‘new’ organisations is our concern about bandwidth (we are very small) and dilution of effort.

I think that was one small driver for the New Zealand Govt sticking with Asia Pacific on Friday night rather than Indo Pacific.

I think questions we need to think hard about include:

• How will we work with China in shaping rules that will be to our mutual benefit?
• What aspects of what they want are legitimate (AIIB/IMF/WB), which aspects of what they want are not acceptable to us (debtors traps, opacity).
• Is this something countries like New Zealand and its partners could work on together?
• If rules are important to a range of small to middle powers, how do we support each other more, and ‘our’ likeminded? ‘A house divided will fall’

The Asia-Pacific middle powers, together with non-ASEAN smaller powers, such as New Zealand, should be working to do more together to strengthen ASEAN and to persuade Beijing - and the US - not to discard old rules and norms and also work together to mitigate and manage tensions and conflicts.

I don’t yet see that intent to work together clearly enunciated nor more importantly actioned. I think we should.

Finally, as I have the bully pulpit, let me close with a belief of mine.
Simply put, countries don’t sleep walk to their future.
I get annoyed when I hear some people say that ‘New Zealand is lucky’ as if we somehow stumbled upon the things we enjoy as New Zealanders, or that our success internationally in innovation, sport, arts and science is mere chance.
I believe that whatever luck we might have as a country is luck made through bold, difficult and brave policy decisions, and because of the hard work of countless New Zealanders — including those of you in this room.
We are in a period where we will have to work hard, and make some brave and difficult policy decisions.

We could be on the threshold of a fantastic opportunity in relation to the rise of Asia’s relevance. New Zealanders used to think our geography is a curse. In 2018, that has changed. But we need to establish a deliberate and considered approach to our engagement with the region so New Zealand can thrive in and with Asia.

It’s time to make our luck again.

So to close :

• Change is the constant let’s not over egg how different ‘now’ is
• Recognise our context influences how we act, and vice versa
• It’s a time for smaller states who are likeminded to work together not fragment to keep what we have got, but also recognising this may require some legitimate institutional adaptations...
• and none of that will happen by luck. Never has.
  
  

Simon Draper