Australia and New Zealand—so near yet so far
17 Oct 2016|

Australia and New Zealand see the world and respond to it differently. That’s not to say there aren’t areas of agreement—free trade, democracy, human rights—but when it comes to defence and foreign policy, there are some important and growing differences.

Consider the ANZUS alliance. Australia’s striving to deepen its alliance with the United States, including hosting US troops in Darwin, while New Zealand remains content to sit apart from ANZUS. Lest there be any doubt, in response to the Australian 2016 Defence White Paper’s depiction of Australia and New Zealand as ‘ANZUS allies’ the New Zealand Prime Minister said ‘…a long time ago we suspended ANZUS and we have no intention of re-joining’. Notwithstanding that the NZ Ministry of Foreign Affairs lists the treaty as ‘in force’ and that it was actually the United States that suspended its obligations to New Zealand under the treaty back in 1986, the message is clear. And, although some have interpreted the 2012 Washington declaration between the United States and New Zealand as heralding a de facto alliance, that’s not what the document says, and it’s not how the 2016 NZ Defence White Paper depicts the NZ–US relationship.

There are also differences in defence spending. Since the end of the Cold War, the gap between the GDP share each country devotes to defence has grown. In 2015 the difference was substantial; 1.9% of GDP for Australia versus 0.9% for New Zealand. As a result, the NZ Defence Force is disproportionately smaller on a per-capita basis (and less well equipped) than Australia’s defence force. Despite favourable reporting, the 2016 NZ Defence White Paper only heralds a partial narrowing of the disparity in the years ahead.

Finally there’s the question of China. Although Australia has adopted a cautious position on the Middle Kingdom’s growing assertiveness, it sounds downright hawkish compared with New Zealand’s circumspection. From China’s announcement of an East China Sea ADIZ in 2013 through to the recent terra-forming in South China Sea, Australia has consistently taken a more forthright position than New Zealand.

Given the shared history and common heritage of the two countries, it’s not immediately clear why such substantial differences have arisen. One possible explanation is that the two countries have divergent interests. But as maritime trading nations in the same part of the world, interests should be strongly aligned; both countries would be severely affected if trade was disrupted, and the security of each is ultimately contingent on strategic stability in Asia. What’s more, New Zealand can’t be secure if Australia isn’t.

It could be that differing trade relations confer different interests—at least when it comes to policies towards China. If nothing else, the fact that New Zealand has an economy one-ninth that of Australia probably results in a heightened sense of vulnerability. Yet, not only is China a proportionately larger export destination for Australia than New Zealand (29% versus 16% of exports by value in 2015), but Australian exports to China are more concentrated than those from New Zealand. Fully 42% of the total value of Australia’s top five exports went to China in 2015 compared with only 20% of New Zealand’s. So, to the extent that export dependence renders a country prone to coercion, New Zealand appears to be better positioned than Australia.

If interests can’t explain the divergence between Australian and New Zealand policy, perhaps the explanation lies in differing values and identity. To an extent, that’s the case. New Zealand, for example, is more committed to the United Nations and other multilateral institutions. More importantly, New Zealand derives considerable pride from having an ‘independent and autonomous’ foreign policy, whereas Australia is proud to be seen as a stalwart US ally that ‘punches above its weight’. More generally, the political evolution of each country has led to distinct strategic cultures and identities.

Australia and New Zealand perceive the world in ways sympathetic to their respective self-images. For example, although both countries advocate a rules-based order, New Zealand’s less willing to concede the need for power—and in particular US power—to preserve that order. Similarly, Australia’s less optimistic than New Zealand about how China will use its growing power in the years ahead. At the risk of oversimplification, New Zealand sees the world as it thinks it should be, while Australia sees the world according to its fears.

Of course, differing views of the world are as much symptoms as explanations. We’re all prone to depict the world in ways that justify the position we adopt. The question remains; why are there so many differences between Australia’s and New Zealand’s positions? After all, in many areas, we face exactly the same challenges.

At least part of the explanation is the interaction of the two country’s policies. The essential point is that the core aspects of New Zealand’s external security are contingent upon Australia’s security. So long as Australia continues to anchor the United States in our part of the world, New Zealand faces no strategic consequences from either remaining outside of ANZUS or deferring to China. Similarly, as long as Australia maintains the scale of forces needed for regional humanitarian assistance and stabilisation operations, New Zealand can continue to place a low priority on its defence capabilities.

It’d be unkind to suggest that New Zealand’s principled approach to world affairs is only possible because of Australia’s more pragmatic approach.  But the idea gains traction if you perform the thought experiment of erasing Australia from the map. What would New Zealand’s foreign and defence policy look like in such an alternative world?