Tough Choices Ahead for New Zealand’s National Government in a Volatile Geopolitical Landscape
New Zealand’s National government faces challenging decisions as they navigate an increasingly volatile geopolitical world. With ongoing conflicts such as the Russian-Ukraine invasion, tensions between China and Taiwan, and the recent Israel-Hamas warfare, finding a balance between trade interests and security concerns is becoming far more difficult.
As the smallest, newest, and most isolated ‘real’ country in the world, New Zealand’s reliance on globalization is crucial. The massive achievement of raising over one billion people in East Asia from poverty to the middle class has benefited New Zealand’s own GDP growth significantly. However, globalisation also carries its fair share of problems, including loss of national and cultural sovereignty, environmental pressures, and uneven distribution of benefits. Therefore, social license must be prioritized when formulating trade policies.
One pressing issue is New Zealand’s dairy industry, which may soon face criticism from overseas consumers and regulatory restrictions due to its methane and nitrous oxide emissions. The incoming government must take swift action on reducing these emissions to stay ahead of potential developments. Additionally, trade policies now need to focus on climate change, particularly the carbon emissions associated with international trade. The EU has already implemented a mechanism to tax carbon emissions on imported products, and other nations are likely to follow suit.
Another aspect the new government needs to reconsider is New Zealand’s international aid and refugee migration policies in the face of extreme climatic events. While current concerns revolve around climate disasters in the Pacific Islands, the situation will worsen in the river deltas of South and Southeast Asia, affecting over a billion people. This will lead to geopolitical tensions and mass refugee displacement. The government must evaluate whether the current immigration policy is suitable for these future challenges.
Navigating these complex issues amid a rough global landscape will be a difficult task for the National-led government. As pressure from countries like the US and China to join political blocs increases, New Zealand must learn from the experiences of ASEAN countries in balancing competing interests. Active participation in international institutions like APEC and the World Trade Organisation remains vital, as they set the rules of the economic game and have protected New Zealand’s interests for decades.
Overall, the government must strike a delicate balance between trade and security interests while prioritizing social license, climate change, and sustainable policies. The challenges ahead require tough decisions and thoughtful considerations to maintain New Zealand’s economic resilience in these turbulent times.
