Foreign policy challenges ahead for Ardern government

Prime Minister Jacinda Ardern and Foreign Affairs Minister Winston Peters will have their hands full with international issues in 2018. Photo: Lynn Grieveson.

Prime Minister Jacinda Ardern and her government successfully navigated their first few months on the world stage, with only a few bumps in the road. However, 2018 may present some early tests for Ardern and her team, as Sam Sachdeva writes.

If Jacinda Ardern took time over the Christmas break to reflect on her first few months in the job, she could be forgiven for feeling some satisfaction when it comes to the international components of the job.

While the overwhelming focus of Ardern’s government after the coalition formation was on issues close to home, its forays into foreign policy by and large went well.

Trade and Export Growth Minister David Parker managed to concoct an elegant workaround allowing the Government to implement its foreign buyers ban without breaching its free trade agreements (bar one notable exception - more on that later).

Ardern’s first major international trip, to the Apec and East Asia summits, included a number of grip-and-grins with world leaders and a well-received speech preceded by praise for her youth and vibrance.

Foreign Affairs Minister Winston Peters largely stuck to the MFAT-approved script, eschewing remarks about China’s growing influence in New Zealand in favour of praise for the country’s economic performance.

Even the controversial TPP trade deal was navigated without too much drama at New Zealand’s end, Ardern and Parker claiming late wins on controversial investment rules to make the agreement more palatable (the final hurdles put in place by other TPP members seem set to be overcome early this year).

Yet the Prime Minister and her team will not be patting themselves on the back too vigorously, with some significant foreign policy challenges lying in wait in 2018.

Repairing regional relationships

First and foremost may be repairing strained relations with some of our regional neighbours, including big brother Australia.

Ardern has been unrepentant about her decision to criticise Australia’s handling of the Manus Island refugee crisis, but while she may have been right to point out shortcomings, it was the tone as much as the substance which seemed to grate across the ditch.

While an Australian promise under the National government to consult on any law changes affecting Kiwi expats appears to have helped to prevent nasty surprises, that approach could yet change and Ardern may want to smooth things over with Australian prime minister Malcolm Turnbull at their annual leaders’ meeting in March.

She may also need to mend ties with Singapore, whose FTA is the only one to be breached by Parker’s foreign buyers fix - a breach which is believed to have angered the country’s officials.

While Ardern has expressed confidence the issue can be sorted out through a renegotiation, it’s an open question as to what if anything New Zealand can offer in return for Singapore agreeing to the ban.

With mixed messages from the Government as to whether Singapore could receive a similar carve-out to that of Australia - Housing Minister Phil Twyford suggested it was possible, while Peters appeared to nix the idea in Question Time - there remains some work to be done.

Similar work must be taking place on the coalition agreement plan to introduce a royalty on exports of bottled water - a proposal which our chief trade negotiator warned would breach existing FTAs.

Then there is the broader issue of New Zealand’s trade priorities. Parker has made plain his scepticism about the last government’s Trade 2030 strategy and its focus on “sexy” FTAs over driving investment into productive sectors.

If he wants to build on his talk of a different approach to trade, guarding against the sort of backlash which led to Brexit, a new trade strategy may need to be developed (don’t expect to see a Russia FTA anywhere near the top of the list, despite its inclusion in the coalition deal).

Time up for Taji?

Some major decisions will also be need to be made in the defence portfolio, including whether New Zealand will extend its work training Iraqi soldiers at Camp Taji beyond November.

While Ardern’s predecessor as Labour leader, Andrew Little, was outspoken about his opposition to any extension, the Prime Minister has been circumspect so far about her current preference.

There is also the issue of whether the last government’s bold plans for an overhaul of defence equipment will survive the change of administration; a blowout in the cost of the Anzac frigates upgrade has already sparked a war of words.

All of this comes against the backdrop of an unpredictable geopolitical environment.

China’s rise and accompanying soft power push, a topic of discussion around the world and in New Zealand, is likely to continue to be a major issue, as is what role United States will play in the world order under Donald Trump.

Add in efforts to curtail North Korea’s nuclear programme, and the rising tide of trade protectionism, and there’s more than enough to weigh on the minds of Ardern and her ministers.

New Zealand may have little influence on some of these big issues, but the National government showed it is possible to exercise some sway as a “middle power” by picking and choosing battles.

The Government will have more than enough on its hands within our borders in 2018 - but it must ensure it keeps its eyes on the broader horizon.