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Trade Minister sends confident message on China relationship as Government told to 'tread carefully'

Publish Date
Mon, 20 May 2024, 2:02pm

Trade Minister sends confident message on China relationship as Government told to 'tread carefully'

Publish Date
Mon, 20 May 2024, 2:02pm

Trade Minister Todd McClay has reasserted that he holds no concerns headed into today's Chinese Business Summit meeting, despite the summit's co-chair Simon Bridges warning that the Government should "tread carefully" given the ongoing geopolitical tensions.

Key issues on the cards include the Government's goal to double exports by value within 10 years, and the implications of expanding into other markets alongside China.

Auckland Business Chamber CEO and former National MP Bridges is co-chairing the summit. He spoke with Newstalk ZB today about entering the room in the knowledge of the disquiet reported around New Zealand's trade and security risks with China.

Bridges said he hoped geopolitical rhetoric could be put to the side as the conversation focuses on the two nations' economies and future trading opportunities. But he admitted that New Zealand would be operating in "interesting times".

"On China, it's very interesting times ... the themes navigating China today. Look at China's economy - critics say it's in trouble, its supporters say it's robust, we'll talk a lot about that," he said.

"I think you know from my part ... both sides have some validity so what does that mean for New Zealand? I think it means we tread quite carefully and we're deliberate in what we say or don't say.

"That doesn't mean pulling our punches, it just means walking more carefully."

Attending the summit, along with ANZ economists and the CFO of Les Mills, will be McClay. He was asked by ZB Plus whether he was heading into the summit with concerns around outcomes given geopolitical tension.

McClay was adamant in his response.

"No, our relationship with China is broad and long-standing. We have strong diplomatic and people-to-people connections that allow us to raise any concerns publicly and consistently, but no."

It's the same response he gave when asked by ZB Plus in March about a Chinese state-sponsored cyber attack on the New Zealand Government. The heads of the Government Communications Security Bureau (GCSB) acknowledged some data was accessed in the hack, which took place in 2021, but said it was not of a “strategic or sensitive” nature.

McClay was set to travel to China at the time and said then that China's general relationship with New Zealand would not change despite the spying announcement.

Today, McClay reiterated this sentiment.

"New Zealand continues to follow an independent foreign policy as we always have and our relationship with China plays a key role in this and our global presence," he told ZB Plus.

According to McClay, the Chinese economy has continued to grow at around 5 per cent, which is the equivalent of three to four times the entire New Zealand economy. McClay said this presents huge untapped potential.

"That additional growth offers great potential for New Zealand businesses in market. And offers an opportunity to support this Government's aspirational target of doubling exports by value in 10 years," said McClay.

"I hope both China and New Zealand businesses leave knowing this Government backs and supports ambition and it is up to them to continue to build and evolve our Comprehensive Strategic Partnership."

On Newstalk ZB's Mike Hosking Breakfast this morning, Bridges was asked by host Mike Hosking whether he was worried about New Zealand's performance in China of late.

While China's domestic situation has been "problematic", according to Hosking, domestic travel in the country had gone through the roof while international travel from the country, including to New Zealand, was not as robust as it had been in the past.

Bridges said he found it fascinating about the Chinese consumer that they "still have a lot of money - but the problem is they keep a lot of it in the bank".

He said there would be a panel discussing this at today's summit.

"Maybe it's a little bit like New Zealand at a level - you know, poor confidence begets poor confidence," said Bridges.

"So whatever you say the situation is and [about] its economy, I think what is true in the end is there is still a heck of a lot of consumers. When I was there last year, it's a heck of an advanced economy [in China] - certainly from where it was 20 to 50 years ago."

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