The coming Chinese dilemma: Gerald Hensley discusses the challenges facing New Zealand in dealing with the developing situation in East Asia.

• Jurisdiction: New Zealand
• Date: 01 September 2020
• Author: Hensley, Gerald

New Zealand has prided itself on practising a moral foreign policy, believing that as a small country without many obligations it can speak up for decency and a rules-based world order. We have not so far faced any serious challenge to this view. Our quarrel with the United States over nuclear ship visits risked only minor retaliation: our trade actually increased during the dispute. Now the course of China's current policies suggests that we face a much bigger struggle with ourselves, a dramatic struggle between our beliefs and our income. The call we make will not only decide the nature of our relationship with China, but the shape of our foreign policy for years to come.

For decades China's economic growth has been a source of admiration to the rest of the world. Though no libertarian, Deng Xiaoping grasped in the 1980s that communist doctrine had to be jettisoned to preserve communist rule. This freed China from the murderous sterility of Maoism and opened the path to a dramatic increase in wealth and the size of the Chinese middle class. The global economy and our own benefited enormously from this economic revolution and so did China's ruling party. Deng cut it loose from a failing system and rebuilt its reputation as the bringer of economic success and national revival.

Thereafter, it was dizzying economic growth that gave legitimacy to Party rule and brought with it a rise in national assertiveness. Nationalism has its dangers as the foundation of a country's foreign policy, as the world learnt in the past century if not before, and Deng's wise instinct was to keep it quiet and emphasis China's desire to be a good international citizen. It worked and the effects of China's pyramiding exports on other countries' workers were lost in wonder at its extraordinary achievement.

Aggressive leader

Then in 2012 China acquired a leader who abandoned Deng's caution and embarked on a series of bold and indeed aggressive nationalist...