Gordon Campbell on National’s extremely cosy relationship with China

key-xi-bannerWhile former PM Jenny Shipley did not write the notorious op ed that appeared under her byline recently in a Chinese newspaper, the article was based on an interview she gave to the newspaper in December. More to the point, the op ed’s content seemed to be consistent with the very positive messages that have been emanating in recent years from a number of National Party politicians (past and present) about the desirability of increasing China’s trade and investment relationships with New Zealand. Along the way, a surprising number of former National Party politicians have developed business ties of their own with China.

Late last year, former PM John Key (the current chairman of ANZ, this country’s biggest bank) told the NZ Herald in a story headlined “Why I’m a China Bull – John Key” that “I think Xi Jinping’s going down in history as a good leader of China”… and furthermore:

“I think if we turned our back on the Chinese, we’d find a lot more Irish and Dutch dairy products would flow into China and less would flow from New Zealand. It might be a bit mercantile but I think that would be negative for the New Zealand economy, for dairy farmers, and for lots of New Zealand businesses — from tourism to education services — that benefit from us having a strong relationship with China. That doesn’t mean that you don’t raise human rights issues or other issues that are important. You do, but I think you’ve got to have a respectful relationship with both [China and the US.]”

So… by all means raise your concerns say about China’s treatment of dissidents, the mass incarceration of thousands of Uighur people and the related programme to exterminate their culture. But do so in a ‘respectful’ manner, lest that should interfere with the pursuit of business as usual. They know we need to say it, and we know how they want us to say it.

How time does fly, though. Back in June 2010, Prime Minister Key and Xi Jinping (at the time, China’s deputy leader) had co-witnessed the signing of an MOU between the ANZ and the China Development Bank, a deal meant to bolster trade and investment between the two countries. Other observers have noted Key’s subsequent role in boosting our relationships with China. On its website, Jacobi Consulting noted in late 2016 that Key visited China six times as PM, and that trade with China had blossomed over that period:

In 2010, Key and Chinese President Xi Jinping agreed to double bilateral trade to $20 billion by 2015, a goal reached a year early. A more ambitious goal was immediately set to grow trade in goods and services to $30 billion by 2020. [Two-way trade was worth $28 billion in 2018.]

Beyond trade, Jacobi Consulting pointed out, Key had re-assured New Zealanders, and broken down the misgivings many New Zealanders have felt about China’s growing importance to us, and about its role in this country:

Beyond trade, Key’s role as the ‘great re-assurer’ served us well with China. He calmly downplayed fears about China’s influence in the residential housing market, the sale of productive farmland and allegations of steel dumping. He urged Kiwis to see China not as a threat..

A similarly positive message has been conveyed by Jenny Shipley, since 2015 at least. As the NZ Herald reported at the time:

Northland companies need to leave prejudice against foreign investors out of their business and accept the emerging influence of Chinese investors and middle income tourists over the next 25 years, a former Prime Minister[Shipley] says.

Shipley urged her audience to abandon what she portrayed as out-dated, inherited prejudices against Chinese foreign investment:

“I challenge you as businesspeople to not suspend your judgment or values, but don’t bring your prejudice to the table,” she said. “Are we open for business or have we grandma on our shoulder? There are many business models that can provide a win/win for everyone…’

China, not the US, Europe or Britain, struck Shipley as being where our best interests would lie infuture:

“The sphere of influence in the last 25 years included the US, Europe and Britain. They allowed New Zealand to be wealthy. In the next 25 years, that will shift as the Chinese are the emerging population.”

Since 2014, Shipley has been chair of the China Construction Bank (CCB) NZ. According to this Stuff report Shipley was paid $50,769 in directors fees for that role between June-December 2015, the equivalent of an annualised figure of $90,000 a year. (The Companies Office also lists Shipley and tax expert and former PWC head John Shewan among the current CCB directors.)

This sum, Stuff claimed, exceeded the $65,000 earned that same year [2015] by yet another former National Party leader Don Brash, for his ongoing role in chairing the local arm of the Industrial and Commercial Bank of China. The Bank of China – which was the third Chinese banking entity to enter the New Zealand market that year – has two other former National MPs (Ruth Richardson and Chris Tremain) listed by the Companies Office as among its directors.

Shipley is also on the board of Oravida NZ Ltd. and of Oravida Waters, an exporter of New Zealand artesian water. As Newshub reported in 2016, among Shipley’s fellow directors at Oravida Waters are Stone Shi and Julia Xu:

Stone Shi and Julia Xu are the brains behind Oravida, and part of [then] Prime Minister John Key’s delegation in Beijing. They’re now exporting Kiwi water to China as a premium product…

Oravida’s history of political donations to the National party and as Newshub puts it, the ‘close personal ties’ that existed between Shi, Xu and National MP Judith Collins caused a huge political controversy in 2014. Evidently, that episode did not derail Oravida’s economic ventures here:

Oravida has a consent to 146 million litres of ground water a year and the regional council says Oravida pays an annual compliance charge of around $500. Oravida markets the water at $1.60 a litre, meaning if all 146 million litres were sold it could be worth $233 million a year.

In passing, other links between National politicians and China also merit a mention. In 2014, National MP Maurice Williamson resigned from Cabinet over his perceived interference in a Police investigation into a domestic violence allegation involving Chinese businessman/party donor Donghua Liu. Liu had been a major donor to the National Party.

Electoral returns out next week [confirm] that a National Party MP received $25,000 from a controversial businessman after Prime Minister John Key had a private dinner with him – at the man’s home.

The PM has always maintained that he met Donghua Liu at a National Party fundraiser but would never say where. Today, the Weekend Herald can reveal that the fundraiser was actually a private dinner at Mr Liu’s $4.75 million home in Remuera, where a smiling Mr Key and Jami-Lee Ross, the MP for Botany, were photographed alongside Mr Liu and his young family. Afterwards, Mr Liu donated $25,000 that same month to Mr Ross’ election campaign.

Liu also reportedly donated $20,000 to the Maori Party before the 2017 election. Other major donors to the National Party before our last election include Philip Hong ( $51,720) Do Yi Shi (aka Shi Stone) of Oravida ( $50,000) and Donny He ($17,000).

Last year, Ross’ role in the alleged re-packaging of a $100,000 donation to National from Chinese donor Zhang Yikun (to ensure the donation complied with the legal thresholds for such gifts) was the central feature of the controversial taped conversations between Ross and National Party leader Simon Bridges.

The China Council

Moving right along… Jenny Shipley also serves on the executive board of the New Zealand China Council, a self-described “cross sector, peak body for the New Zealand China relationship.” Its current chairman is former National Party deputy PM Don McKinnon, and its CEO is Stephen Jacobi, of the aforementioned Jacobi Consulting. The executive board includes Mark Averill of PWC and former Wellington mayor Kerry Prendergast, and its board of advisers include Labour MP Raymond Hou, journalist Fran O’Sullivan and Karen Qian Hou – who is the general manager and executive director of the New Zealand branch of the Industrial and Commercial Bank of China, the bank whose board is chaired by former National Party leader Don Brash.

The advisory board of the NZ China Council also includes the controversial National Party list MP Jian Yang, whose background was extensively reported on by Newsroom in 2017:

A National Party MP who studied at an elite Chinese spy school before moving to New Zealand has attracted the interest of our Security Intelligence Service.

The list MP Jian Yang did not mention in his work or political CVs a decade he spent in the People’s Liberation Army-Air Force Engineering College or the Luoyang language institute run by China’s equivalent of the United States National Security Agency. That agency, the Third Department, conducts spying activities for China…..He was hand-picked by National Party president Peter Goodfellow to become an MP on its list in 2011, wooed directly by the former Prime Minister John Key and has been a key fundraiser for National among the Chinese community in Auckland.

The Council’s effusive report on China’s equally controversial Belt and Road Initiative – which was prepared by PWC with the help of what McKinnon described in the foreword as a “significant grant” from MFAT – can be found here.

The military/security dimension

So far, I’ve focussed on our economic relationship with

China, that has been championed by a sizeable number of senior National Party politicians, both while in office and after leaving it. As previously mentioned, New Zealand has tried to expand its economic ties with China, while also retaining its traditional defence ties with the US, Australia and Britain. Those boundaries have been pushed to the limit. In Beijing in 2015 for example, then-Defence Minister Gerry Brownlee gave a major speech that (a) fulsomely praised our existing military ties with China and also (b) floated the notion that our defence relationships with China and the US were not mutually exclusive:

“We do not expect the South Pacific will face an external military threat.” Brownlee also called China a “strategic partner” and lavishly praised our “Five Year Engagement Plan with the Peoples’ Liberation Army.” In that same speech, Brownlee tiptoed around the South China Sea issue, calling on “all claimant states to take steps to reduce tensions” within the framework of international law. No blame being levelled there, no sides taken. Interestingly, Brownlee also said: “We do not see our defence relationships with the United States and China as mutually exclusive.”

The Chinese, it seems, [were] now being viewed by the Key government as being our military allies, as well as our partners in trade. As Brownlee put it at the White Paper press conference, the old paradigms no longer apply: “Those old type allegiances, alliances, you know a good guy, a bad guy – I don’t think they’re as clearly stated [now] as they were.”

If it had been a centre-left government that had suggested such a thing – ie that our defence/security ties with our traditional partners in the West were potentially now no more important than our links to the Communist Party leadership in Beijing – one can only imagine the howls of protest. Yet clearly, the Key government’s pursuit of its economic relationship with China had now extended to downplaying (to Beijing at least) the value that we place on our traditional defence and security alliances.

Little wonder then, that the Huawei interim decision (a situation created by our membership of one of the oldest of those traditional security alliances) should have caused such concern among the upper echelons of the National Party. Since then, National has publicly campaigned against the Ardern government’s apparent pushback against China’s most innovative digital firm.

Over the past two months, National’s current leader Simon Bridges has sought to engineer a crisis out of the alleged “deterioration’ in our relationship with China. Bridges has blamed this ‘crisis’ on the actions of the coalition government over Huawei, and it has called for corrective action to re-assure Beijing of our friendly intentions.

In reality, New Zealand’s participation (alongside our 5 Eyes security partners) in the interim banning of Huawei technology from the building of our 5G telco networks has not (so far) engendered anything like the retribution that China has taken against our other 5 Eyes partners. For months, China has engaged with Canada and Australia in a tit for tat series of visa revocations, indefinite trade bans and arbitrary arrests, including the imposition by China of a retrospective death sentence on one particularly unlucky Canadian drug dealer. Nothing remotely like those kind of steps have been imposed by China on New Zealand. By comparison, we’ve been given the kid gloves treatment, and New Zealand continues to be treated by China as the friendliest face in the 5 Eyes club.

Regardless,Bridges has laid much of the blame for the alleged “deterioration” in the China relationship upon Foreign Minister Winston Peters.

That selective focus on Peters is significant. Last year, Peters and his NZF colleague Defence Minister Ron Mark embarked on a “Pacific reset” as part of a belated attempt at countering China’s expanding military role (and cheque-book diplomacy) in the Asia-Pacific region. In December, Peters gave a speech at Georgetown University in Washington DC that urged the US not to retreat further into isolationism.

Normally, you might have expected the centre-right to share Peters’ concerns about the US retreat and related disengagement from regions and institutions of prime significance to us. In its role as China’s dogged champion though, National has chosen to blame the coalition government for doing little more than seeking to maintain the customary balance of power in the Asia-Pacific region. In the process, the usual ideological positions have been reversed. Currently, it is a centre-left government that is seeking to maintain the US regional presence, while the centre-right Opposition has gone into bat for the socialist superpower.

Finally, the Belt and Road stampede

Overall, it has been a highly successful campaign that National has waged, largely to China’s benefit. The deterioration claimed by Bridges is now taken to be a media given, and the government has been left scrambling to counter the perception of a crisis in its foreign relations. PM Jacinda Ardern has done her best to inject a note of reality – trade with China is up, inbound Chinese tourism numbers are up etc – but to no avail. After all, how do you prove the non-existence of a phantom?

Why hasn’t Ardern flown off to China, the Opposition has protested, in order to re-assure the Chinese leadership of our good intentions and to (re)gain China’s seal of approval? The supposed need to do so had been set out by Jacobi Consulting back in 2016, in the course of the praise it lavished upon John Key:

What he leaves is a challenge for all future Prime Ministers: If you genuinely value our relationship with China, don’t just say so. Get on that plane and prove it.

Oh, but before she even boards that pilgrim’s plane to Beijing, Ardern would also apparently need to have fast-tracked New Zealand’s involvement with China’s signature Belt and Road Initiative. As RNZ reported earlier this week:

Officials are increasing work on how this country might get involved in China’s Belt and Road Initiative…

And why would that be? Reportedly, the negotiations over the nature and scale of our involvement with the Belt and Road Initiative had got bogged down of late. Yet happily for Beijing, the political controversy that National has created over the allegedly parlous state of our relations with China has succeeded in putting pressure on our side of the negotiating table! As RNZ reported on Monday:

The executive director of the NZ China Council Steven Jacobi says work on the [Belt and Road Initiative] plan has quickened recently, probably because the relationship with China has been under a bit of pressure. “I think the government has been working quietly on this behind the scenes over the last year but I think what’s happened now is that they have been ramping up the action. That’s a very good thing. Because they see one of the solutions to the current situation we find ourselves in, is sitting right there waiting to be done. And that’s a good thing…

Yep, MFAT being induced to negotiate under domestic political pressure is bound to produce an outcome that’s in the best interests of New Zealand. Perhaps we should be regarding the ‘deterioration crisis’ as a successful piece of political lobbying by National, to China’s advantage. Not that there wouldn’t be rich pickings for well-placed local individuals and firms on the side. There should be, one imagines, quite a lot of banking/infrastructural development money in prospect from any Belt and Road contracts that we manage to pressure ourselves into signing, in future.

Footnote: For a more jaundiced report on the value of Belt and Road initiatives, there’s this report by Bloomberg on how Asia fell out of love with projects that in some countries, are already leaving behind a lack of transparency, corruption, relatively few jobs for local labour, and in some cases, mountains of debt.

Investing in Angel

Angel Olsen has had a pretty quiet past 18 months. She’s shifted to Asheville, North Carolina, gone on a solo acoustic US tour, and released an album of out-takes from her earliest albums….and she’s been playing quite a few songs dating from the period before 2012’s Half Way Home album launched her career. Reportedly, one reason she left Chicago was to avoid the pressures that fame had started bringing her way in 2017:

The intensity of having others project themselves onto her—having fans cry in her arms, strangers thinking they know her intimately because of something she wrote eight years ago—has clearly begun to wear on her, but Olsen is taking it all in stride. “I want to tell people that it’s great they’re inspired, but to go home and do something that’s unique to themselves and cultivate that,” says Olsen. “I hope to keep my sense of humour about it. Sometimes when people say, ‘Are you Angel Olsen?’ I say, ‘I think I am, can you show me that I am?'”

That wry sense of distance have always been an interesting part of her persona. That, and the unpredictable way she uses her vibrato. Currently, there is no new Olsen music in sight. So in the spirit of her own recent acoustic celebration of her past, here are a few of those older acoustic clips:

And then there’s this classic performance, from the 2013 Pitchfork festival:

This track “Sans” from last year’s album of out-takes is pretty great, too: