1. China to NZ: 'Correct wrong words'

Acting Prime Minister Winston Peters says New Zealand cannot "defy gravity" and withhold criticism of China on its activities in the South China Sea. Photo: Lynn Grieveson.

The Chinese government has told New Zealand to “correct its wrong words” on the South China Sea, but Acting Prime Minister Winston Peters says the Government intends to hold firm. Sam Sachdeva reports.

Peters also says the Government is “not naive” as to the possible trade implications of its remarks, after Australian exporters faced delays at the Chinese border following its government’s conflict with Beijing.

The Government’s Strategic Defence Policy Statement, released last week, raised concerns about the security threat posed to New Zealand and the world order by “an increasingly confident China”.

The document described the Asian superpower’s development model as “a liberalising economy absent liberal democracy”.

It also referred to China’s expanded military presence in disputed areas of the South China Sea, saying the country had “determined not to engage with an international tribunal ruling on the status of sovereignty claims”.

“We urge New Zealand to view the relevant issue in an objective way, correct its wrong words and deeds and contribute more to the mutual trust and cooperation between our two countries.”

At a press conference in Beijing on Monday, China Foreign Ministry spokeswoman Hua Chunying said the country had taken note of the defence policy statement and “lodged stern representations with New Zealand on the wrong remarks it has made on China.”

China would “unswervingly follow” its advocacy of socialism with Chinese characteristics, Hua said, acting as a contributor to global development and a champion of the international order.

“China's development poses no threat to others. Instead, it will provide other countries around the globe with important opportunities.”

China’s construction of military installations in the South China Sea was “completely justified and legitimate”, and it would safeguard its territorial sovereignty while negotiating directly with affected countries to resolve the disputes”.

“We urge New Zealand to view the relevant issue in an objective way, correct its wrong words and deeds and contribute more to the mutual trust and cooperation between our two countries.”

'We're not naive as to what happens here'

Speaking to Newsroom on Tuesday, Peters said the Government did not intend to resile from its comments.

“Well, just because you're in foreign affairs doesn’t mean you should try to defy gravity - we know the South China Sea military buildup is coming from one country, all of the South China Sea neighbourhood knows that, so we’re just making an observation that everyone’s making.”

Peters said he was unconcerned about possible trade reprisals from China, such as delays faced by Australian wine exporters, saying New Zealand was operating in a “vastly different” global environment to even a month ago.

However, he acknowledged that “having stock held up on the wharves is not new”, such as a temporary hold on kiwifruit exports into China, one month after Chinese officials warned Zespri of possible retaliation over a steel dumping investigation.

“Let’s put our cards on the table - we’re not naive as to what happens here.”

“We have trading relations with China, we have a number of international cooperative enterprises going on with China, we work with China in the Pacific on occasions, it’s a relationship which has been built up over the years, but that doesn’t mean that we, how should I put it, lose our independent, sovereign voice.”

If such trade delays were to occur, Peters said a diplomatic resolution would be preferable to countervailing measures given New Zealand’s size.

“There’s only so much we can do, but we’re not alone in this respect, countries should tread carefully no matter how big they are.”

The Government had been transparent about its foreign policy and advocacy for the international rules-based order both at home and abroad, he said.

“We have trading relations with China, we have a number of international cooperative enterprises going on with China, we work with China in the Pacific on occasions, it’s a relationship which has been built up over the years but that doesn’t mean that we, how should I put it, lose our independent, sovereign voice.”

Belt and Road questions remain

During a March speech at the Lowy Institute, Peters said he regretted the speed with which the previous government had signed up to China's Belt and Road Initiative, a trillion-dollar project aimed at increasing connectivity between the superpower and the rest of the world.

He told Newsroom he had asked the Chinese government for more information about the project during his visit to Beijing in May.

“We don’t know what we’ll take forward or not take forward because we don’t know what it means and there is an acceptance by the Chinese that it's a fair request from us and we’re awaiting developments.”

While a memorandum of understanding between New Zealand and China said a detailed work plan should be developed within 18 months - a deadline coming up in September - Peters said the Government did not feel bound by its predecessor’s arrangements.

“When you look at it [the agreement], its words are without any substance, it’s not binding - it doesn’t require us to do anything.”