China/New Zealand diplomatic relations are tense at the moment.
“We need to stay out of these things and not take sides,” said Beijing-based Kiwi businessman David Mahon to NZ Herald. “Because if we choose to take sides we will be crushed.”
Mr Mahon, who has been living working in China since 1984 has been watching New Zealand’s commercial relationship evolve and grow over the decades. That’s changing.
Ban
It all stems from the NZ Government’s decision to exclude Chinese telecommunications company Huawei from the country’s network 5G network tender process last November. NZ Telecommunications services provider Spark made the request and China understood the decision as a ban. Stuck between a rock and a hard place, the Kiwis effectively had a choice between security or trade.
Trade delays are now being reported. Foreign affairs and trade spokesman Todd McClay said in a statement on Wednesday: “We are hearing increasing reports of exporters facing problems with exports to China.”
But by taking the United States stance on the Huawei, NZ’s long-standing friendly relationship with China is souring and affecting exports. Business Herald Editor Duncan Bridgeman said: “They are certainly picking up a vibe that different industries are starting be affected for some reason – but we need to be careful not to jump to any conclusions.”
Trade blacklist
New Zealand exporters are afraid that they may now be on a trade blacklist following access problems for fresh salmon shipments. China and New Zealand signed a Free Trade Agreement in 2008 and since then have phased in provisions to ease trade between the two countries, until now that is.
King salmon farmer and exporter Sanford has been having issues getting salmon exports to China cleared through Chinese ports, according to NZ Herald.
However, the publication reported that NZ’s biggest seafood exporter is not attributing its recent administrative issues to the frosty diplomatic situation. In an email to SalmonBusiness, Chief customer officer Andre Gargiulo said: “We have recently experienced administrative issues with our salmon exports to China, which have caused delays getting shipments cleared through Chinese ports. This has impacted several shipments of fresh salmon since the end of January. We have not been given a reason for this by local authorities.”
Challenges
On Tuesday, the Herald reported that Prime Minister Jacinda Adern was scheduled to visit China but the invitation has been put on hold. She has denied there is a serious diplomatic issue with China, although she has acknowledged challenges.
“There are challenges in our relationship, there are challenges in our relationship with a number of countries at any given time when you run an independent foreign policy,” she told parliament on Wednesday.
Nick Siu, director of consultancy firm The Agency 88 which specialises in Asian markets, told the publication that he was surprised at the Government’s lack of effort to reconcile tensions given China is the country’s most important trade partner.
SalmonBusiness has contacted Sanford for comment.
