OIA 28201 Sebastian Key foreign policy priorities 2021 24 Redacted.pdf

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Key foreign policy considerations for the next 12-24 months
Annex Two: Aotearoa New Zealand’s foreign policy 2021 – 2022:
Toward greater resilience

See next page.
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Purpose
This paper provides an assessment of Aotearoa New Zealand’s shifting operating context and
the near-term implications for the country’s foreign policy as the world emerges from COVID’s
grip. Key foreign policy considerations for the next 12-24 months are outlined.
Executive summary

This paper outlines key foreign policy considerations over the next 12-24 months as Aotearoa
New Zealand continues on the long road to rebuilding our economy and connections with the
world following the imposition of COVID-19 border restrictions. The paper situates our COVID
recovery and rebuild within the broader context o s6(a), s9(2)(g)(i)
our strategic
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environment.

2
Since the end of the Cold War, “the West” has had a favourable strategic environment.
s6(a), s9(2)(g)(i)
a rules-based international order that reflecteds6(a), s9(2)(gliberal valuess6(a), s9(2)(g)(i)
s6(a), s9(2)(g)(i)
  We have benefited from increasingly open trade frameworks that
both boosted our GDP per capita in real terms, spurred innovation and cheaper consumer
goods and services and created conditions for the expansion of the Māori economy. And,
perhaps most importantly, s6(a), s9(2)(g)(i)
conflicts that
New Zealand has been involved in (either diplomatically or with Defence Force personnel)
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have, s6(a), s9(2)(g)(i)
, taken place far from home.
3
These foundations on which our foreign policy has rested for a generation no longer
hold. The tide was already turning pre-COVID but the pandemic has accelerated the shift and
revealed additional pressure points.  We live in an age of much uncertainty s6(a)
and
this new reality wil  provide the backdrop against which our foreign policy choices wil  be made.
Going forward, much is unknown about the COVID trajectory but
OFFICIAL  it wil almost certainly be with
us in one form or another for the next three to five years. COVID’s indirect effects on societies,
economies, governments and security wil  compound over times6(a), s9(2)(g)(i)

    THE
4
This paper describes a world that is predicted to be less open, less prosperous,
less secure and less free.  Even as the health threat recedes, the economic impacts of
COVID wil  start to bite much deeper.  s6(a), s9(2)(g)(i)



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  At the same time, geostrategic competition in our region
has sharpened s6(a)
.
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5
s6(a), s9(2)(g)(i)
Against that backdrop,
a central theme of this paper is  the need to use our foreign policy to support the
building back of Aotearoa New Zealand’s resilience.  s6(a), s9(2)(d), s9(2)(g)(i)

ith greater resilience as the overarching goal over the short term,
this paper notes the following key areas of foreign policy focus over the next 12-24 months:
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•  Working in partnership and focusing development investments to build a
more resilient Pacific s6(a), s9(2)(g)(i)

The focus, scale and manner, of our support
to the Pacific in this periods6(a)
wil  shape the region and our
place in it for years to come.  In the year ahead we wil  harness bilateral, regional
and multilateral action to support Pacific priorities, recognising the mana of each
nation, and reinforcing our whanaungatanga across the Blue Continent.
•  Ensure our engagement in Indo-Pacific groupings s9(2)(g)(i)

s9(2)(g)(i)
reflects Aotearoa New Zealand interests, principles and values –
s9(2)(g)(i)

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   We wil  work with regional
partners to support a peaceful Indo-Pacific and to strengthen the regional
structures that are already established.s6(a), s9(2)(g)(i)

•  Grow Aotearoa New Zealand’s economic resilience – Our country has had to
confront a global pandemic, a global recession and increasing strategic
competition at the same time.  These tumultuous events have markedly changed
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the international trade environment. Trade policy responses are needed to
s6(a), s9(2)(g)(i)
.   Priorities wil  be  to strengthen
international trading  rules and systems  and support market diversification,
including through conclusion of new Free Trade Agreements (FTAs) with the UK
and the EU.  Our hosting of APEC this year provides a unique opportunity to help
shape a sustainable recovery and lock-in the region’s prosperity.
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•  Invest in and buttress international cooperation and multilateral outcomes
–  The rules-based international system is under pressure s6(a)

THE   Despite the challenges, Aotearoa New Zealand’s
commitment to multilateralism and the rules-based international system remains
steadfast as there is no better means through which to promote collective action
on global problems; to maintain predictability and stability in global rules and
norms; to promote human rights; to constrain the use of force; s6(a)

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We need to prioritise where and how
we direct our effort to address areas of  direct concern to our country  and to
ensure the system continues to reflect liberal values more broadly.
•  Tackle increasing risks to Aotearoa  New Zealand’s security –  COVID
continues to be a risk amplifier and risk multiplier across the international security
portfolio, s6(a)
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International development
cooperation and capacity-building assistance wil  be even more important, ass6(a)


s6(a)

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•  Supporting the Government’s climate change ambitions through
international links –  2021 is shaping up to be a critical “signal ing” year
internationally on climate change policies. How Aotearoa New Zealand positions
itself wil  impact on many other areas of our foreign policy, including  our
relationships s9(2)(g)(i)
and our global
brand and reputation, including as a trusted, environmentally-sustainable
supplier of healthy food.
6
In order to achieve these objectives, we wil  need to:
•  Step up high level contact and re-establish regular official and ministerial
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travel  –  s6(a), s9(2)(g)(i)

•  Invest in our relationships withs6(a)
friends and close partners – Our
international relationships are the cornerstone of our foreign policy, without which
we can achieve very little. s6(a)

the importance s6(a)
partners –s6(a)

increases.  We wil  need
to find ways to reinforce our relevance and value-add to others.
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7
Finally the paper sets out the chal enges in operating in a COVID environment,
including the limitations of virtual diplomacy and the s6(a), s9(2)(g)(i)

8
The directions set out in this paper are consistent with Aotearoa New Zealand’s
intergenerational foreign policy fundamentals of pursuing our nati
OFFICIAL  onal interests for the benefit
of New Zealanders,  supporting sustainability and promoting values and norms so that all
people can live in peace and prosper now and in the future.  The focus on boosting long-term
resilience is consistent with the Government’
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Living Standards Framework and the subsequent formation of a wellbeing approach.
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Background
9
It has been a little over 18 months since COVID erupted on to the world stage.  Since
then, the virus has spread to 220 countries and territories around the world and across every
continent, including Antarctica.  Over two billion people have been infected and well over
four million people have died as a result of COVID.2  New strains of the virus continue to
emerge that are significantly more infectious, and some strains also appear to be more lethal.
Vaccine roll out is proceeding at pace in some richer countries and by the end of this year
some of these countries may be approaching herd immunity or at least have serious health
impacts significantly limited.  New variants wil  continue to emerge and wil  complicate and
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delay – but seemingly not derail – the global vaccination drive.3  Significant inequities in vaccine
access globally persist, however, and wil  perpetuate il ness, promote development of new
variants, exacerbate inequality and further increase drivers of the full raft of international
security challenges.
10
We must remind ourselves that this bleak picture is far more positive than had been
anticipated at the outset. When the virus first began to surge early in 2020, modelling was
predicting that 40 mil ion people would die in 2020 alone and there were questions over
whether a vaccine could ever be developed, never mind in record time.
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11
To avoid the predicted dire health outcomes, countries imposed various restrictions,
including border closures and strict social distancing measures. These restrictions have had
and continue to have profound economic impacts.   The OECD estimates that the global
economy contracted by 3.4 per cent in 2020.4  Within countries, the brunt of the economic
impacts have been borne by low-income and minority communities and women, who are more
likely to work in the hard hit hospitality sector and in the informal economy, as well as youth
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populations, which have experienced significant disruption to education and employment
prospects.    Development progress has been set back years, pushing the Sustainable
Development Goals (SDGs) further out of reach.
THE
12
Alongside the devastating health and economic issues that  overwhelmingly
characterised 2020, COVID has also had wider impacts on international affairs and Aotearoa
New Zealand’s operating context. COVID-19 remains a risk s9(2)(g)(i)

It has accelerateds9(2)(g)(i)
geostrategic, populist, and nationalist trends already under way; it
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has placed more pressure on s9(2)(g)(i)
international system; and it has
exacerbated pre-existing s6(a)
challenges s6(a)
  Over the longer term, high ongoing
health, social and economic costs wil  accrue in countries that experienced high caseloads.
The New Zealand Government’s decision to pursue a COVID elimination strategy means that
our country has had a very different COVID experience from most others.  Our health and our
economy are in better shape than many others s6(a), s9(2)(g)(i)


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2  Worldometer,  https://www.worldometers.info/coronavirus/countries-where-coronavirus-has-spread/, as at
10 August 2021, although official figures significantly understate the number of COVID cases and deaths.
3 Regular vaccine “boosters” look likely to be required. Pharmaceutical companies are currently confident they wil
be able to deliver effective vaccines for virus mutations expeditiously.
4 OECD Economic Outlook, Interim Report March 2021, OECD, https://www.oecd-ilibrary.org/economics/oecd-
economic-outlook 16097408, accessed 22 March 2021.
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Analysis
13
The period ahead wil  be complex and there are many unknowns: about the COVID
virus; about vaccination timelines and trajectories; about the duration of the global recession;
about how businesses and countries wil  factor in resilience in trading relationships over the
longer term; s6(a)

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Nevertheless, Aotearoa  New Zealand’s enduring foreign policy interests remain
unchanged, even if familiar patterns, hard-fought progress, modes of engagement and
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international momentum on things that matter to New Zealand have been set back or disrupted.
New Zealand’s enduring foreign policy interests are:
•  An international rules-based order, which gives all countries a voice and provides
frameworks that promote stability;
•  Keeping New Zealanders safe, promoting regional stability;
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•  International conditions and connections that aid our prosperity, including supply
chain resilience; and
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•  Global action on sustainability issues such as climate change where solutions
depend on international cooperation.
16
Similarly, our foreign policy priorities to 20305 also endure:
•  Strengthening s6(a)
the Pacific;
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•  Shaping an Indo-Pacific regional order that reflects  Aotearoa  New Zealand
interests;
•  Maximising Aotearoa New Zealand’s trade value and resilience;
•  Investing in global rules and institutions that deliver for Aotearoa New Zealand;
•  Tackling increasing risks to Aotearoa New Zealand’s security; and
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•  Playing a credible role in global climate change action.6

5 As set out in the Ministry’s most recent strategic assessment, Strategic Assessment 2030: Building our future in a
disordered world, which was finalised in late 2019.
6 MFAT (2019): Strategic Assessment 2030: Building our future in a disordered world.
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17
This paper considers the most pressing strategic issues Aotearoa New Zealand’s
foreign policy wil  need to navigate over the next 12-24 months under these 10–year foreign
policy priorities in order to promote intergenerational wellbeing for New Zealanders over the
longer term, as well as delivering  on  our  responsibilities to progress regional and global
priorities, including through the provision of effective development cooperation, and
championing human rights.  Al  the while, Aotearoa New Zealand wil  be guided by our core
values – by manaaki, whanaunga, mahi tahi and kotahitanga, and kaitiakitanga – that propel
us to create strength through partnership, to enable rangatiratanga, to support sustainability
and to promote values and norms so that all people can live in peace and prosper now and in
the future.
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Strengthening s6(a)
the Pacific
s6(a)



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s9(2)(g)(i), s6(a)
  Having already suffered the
economic consequences of prolonged border closures, Fiji is seeking to manage the
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pronounced social and health impacts of a devastating COVID outbreak. Sustained donor
support wil  be required to assist Fiji’s response and recovery efforts over the coming months.
In Papua New Guinea, we are likely to see a sustained COVID outbreak s9(2)(g)(i), s6(a)

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There are also implications for
the spread of COVID  through Bougainvil e to Solomon Islands s6(a), s9(2)(g)(i)

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20
Long-run challenges around supply chain resilience, aviation and shipping links have
increased as a result of COVID. Similarly, recovery from the  pandemic wil  compound
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worsening effects of climate change. Climate change remains the single greatest threat to
Pacific lives and livelihoods and to the prosperity, security and wellbeing of the region as a

7 GDP per capita in the Pacific may not return to 2019 levels until 2028 (“Avoiding a Pacific lost decade: Financing
the Pacific's COVID-19 recovery”, Lowy Institute, https://www.lowyinstitute.org/publications/lost-decade-pacific,
accessed 19 April 2021).
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whole.8  The frequency and impact of extreme weather events, degradation of fresh water
supplies, erosion/loss of land and occurrence of zoonotic diseases on Pacific island countries
wil  continue to increase, but governments, economies, infrastructure and societies already
stretched by COVID wil  be less able to respond. These issues wil  compound, with associated
implications for Pacific island countries’ longer-term resilience.
What this means for Aotearoa New Zealand
21
Our engagement within the Pacific reflects our deep connection with the region and its
people and is driven by our desire for a peaceful, stable, prosperous and resilient
neighbourhood – all interests that have been compromised by the pandemic. 2020 allowed for
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buffering against the initial COVID crisis.  We must continue to respond with a range of concrete
deliverables including financial support, vaccines and pathways towards economic resilience.
The stakes are higher, s6(a), s9(2)(g)(i)




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While COVID-19 presents urgent health and economic risks to the Pacific, s9(2)(g)(i)
As we work with Pacific partners on the COVID recovery,
it is critical that we “build back better” to support climate resilience or we risk undermining the
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Pacific’s long-term ability to withstand future shocks from climate change.
Policy considerations
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24
In order for Pacific island countries to begin the slow rebuild, they need to be able to
reopen their borders safely. To do that, like Aotearoa  New Zealand, they need vaccines.
Ensuring access to and effective roll out of COVID vaccines is a critical foreign policy
priority.  s6(a)

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.
25
A further critical priority is preparedness to contribute additional budget support to
tide over key Pacific partners suffering immediate fiscal distress, especially while travel
restrictions remain in place.  s6(a), s9(2)(d)


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8 Ten of the top 30 countries in the world with the highest average annual disaster losses in terms GDP are Pacific
Islands (MFAT Humanitarian Action Policy 2019).
s6(a)
In 2018 (the latest date for which figures are available), of the AUD2.89
bil ion in ODA provided to Pacific island countries, 45% came from Australia; 9% from New Zealand; 8% from China
(though much of China’s assistance sits outside ODA parameters and this figure therefore under-represents China’s
true contribution to the region); 6% from Japan; 5% from the Asia Development Bank; and 4% from the World Bank.
The remainder came from a range of other donors, including the EU, the US, the UN, Taiwan, South Korea and the
Green Climate Fund. (Al  data are from the Lowy Institute, “Pacific Aid Map”, Lowy Institute,
https://pacificaidmap.lowyinstitute.org/, accessed 19 April 2021.)
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s6(a), s9(2)(g)(i)


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A key relationship consideration over the next 24 months  wil  be how we provide
opportunities to support Pacific countries to rebuild themselves and develop long-term
resilience and wellbeing:10
•  Supply chain resilience is a potential constraint on Pacific recovery and a longer
run threat to the region’s economic resilience, with flow on effects for social,
governance and fiscal resilience.  The work Aotearoa New Zealand has done and
continues  to do around our own supply chain resilience usefully takes Pacific
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interests into account;
•  Tourism and labour mobility are essential for the Pacific’s economic resilience.
The timing of  travel bubbles with New Zealand  and access to Aotearoa
New Zealand’s  labour mobility schemes, as well as our broader immigration
settings, wil  need to be carefully navigated s6(a)

The close intersection with Aotearoa  New Zealand domestic policy-making,
especially around public health, education  and labour markets, underlines the
ongoing importance of the Government continuing to take Pacific interests into
account in domestic policy settings; and
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•  Fuller resumption of education opportunities  (scholarships) wil  also support
social recovery and intergenerational resilience.
27
Given the scale of humanitarian need s6(a)
ns, it wil  be
imperative that Aotearoa  New Zealand  coordinate closely with partners to support the
Pacific recovery.  s6(a), s9(2)(d)
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International
financial institutions and multilateral bodies wil  play a crucial role, s6(a), s9(2)(d)

THE

.
28
Sustaining, and where necessary building, political relationships with Pacific
counterparts will continue to be essent
UNDER  ial.  Meeting this objective wil require effective virtual
engagement to be maintained until it is possible to re-launch a concerted programme  of
physical engagement, kanohi ki te kanohi. Greater high level engagement would help reinforce
Aotearoa New Zealand’s important relationships in the region and underscore our hononga
with the Pacific.  How Aotearoa New Zealand works alongside Pacific partners wil  continue to
be as important as what we do. Demonstrating the values of whanaungatanga, kotahitanga
and kaitiakitanga and acknowledging the inherent mana of Pacific countries wil  strengthen our
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s9(2)(g)(i)

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partnerships. Aotearoa New Zealand’s own strategic position wil  be enhanced by supporting
ours6(a)
partners to engage in similar ways.11
29
Our strength and success as a region relies on Pacific countries acting together. The
decision by Micronesian countries to withdraw from the Pacific Islands Forum (PIF) wil  take
time and effort to work through. Less regional cooperation wil  not help in tackling common
challenges; it wil  potentially complicate our coordination with development partners across the
region; s6(a)


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The expectation that Aotearoa New Zealand wil  champion Pacific interests, particularly
on climate change, means Aotearoa New Zealand’s domestic and international action on
climate change wil  shape our future role and influence in the Pacific.  Aotearoa New Zealand
leadership on addressing the issue of the impact of sea level rise on maritime zones has been
welcomed by our Pacific partners.  Meanwhile, our efforts to help Pacific island countries
respond and adapt to the impacts of climate change will need to continue apace, with
the need for humanitarian assistance and disaster relief support likely to increase.
31
Finally, the COVID pandemic has increased the likelihood s6(a), s9(2)(g)(i)

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of instability in the region of a kind that would require
s6(a)
assistance to resolve. s6(a), s9(2)(g)(i)

s6(a)
Coordination
and contingency planning s6(a)
wil  be important.
Shaping an Indo-Pacific regional order that reflects
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Aotearoa New Zealand interests
32
Aotearoa New Zealand’s wellbeing is inter-twined with that of the Indo-Pacific.  We
THE
have a deep stake  in a peaceful, secure, prosperous and resilient Indo-Pacific region and
stable regional architecture that supports our preferred rules and norms, including liberal
democratic values, human rights, free trade principles and stable and secure maritime routes.
s6(a)
, these interests have only been impacted at the margins
by COVID.
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Much of Asia has controlled the pandemic fairly well12 and the region as a whole has
emerged earlier and stronger economically than other regions.  s6(a), s9(2)(d)

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s6(a)

.
12 Although parts of Asia that appeared to have the virus in check are now suffering surging caseloads.
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s6(a), s9(2)(d)
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Policy considerations
38
s6(a)
There is a strong need
to bolster UNCLOS and its regime of maritime zones in addition to the emphasis we already
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place on freedom of navigation and overflight.  s6(a), s9(2)(d)

39
Aotearoa  New Zealand has  a  rare opportunity to influence the region  in 2021
through  our chairing of APEC.  APEC’s role in building regional resilience and enabling
recovery from the pandemic continues to be a focus of APEC Ministers’ conversations this
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year.  With the institution having faced several difficult years, our longer-term purpose is to
revitalise APEC as an institution that champions liberal norms and regional order.  s6(a), s9(2)(d)
New Zealand has an opportunity this year to chart  APEC’s course by developing an
implementing agenda that wil  guide the institution’s work through to 2040 on economic policy
(including trade), sustainable and inclusive growth, and digital.  s6(a), s9(2)(d)

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A focus on economic security and “greening” the COVID  recovery will be an
Aotearoa New Zealand priority s6(a)


41
Aotearoa New Zealand wil  also contribute towards post-COVID regional resilience
through the upgrade of the ASEAN-Australia-New Zealand FTA and implementation of a new
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five-year programme for the ASEAN relationship focused on the themes of peace, prosperity,
s
planet and people.
s6(a)
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Maximising Aotearoa New Zealand’s trade value and resilience
46
The trade impacts of COVID on the Aotearoa New Zealand economy have been
significant but not as bad as we feared, with impacts at the lower end of initial forecasts.13
We have faced some challenges: nationalist and protectionist measures have become more
pervasive s6(a), s9(2)(g)(i)
global demand has dropped; supply chain issues have arisen
for both imports and exports; and border restrictions continue to impact s9(2)(g)(i)
on how
services are delivered.  Yet it is fair to say that our exports, while inevitably down, have for the
most part held up better than we expected.14   The exceptions are tourism and education
services, where border restrictions continue to mean that these industries are profoundly
impacted.
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15  s6(a)






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49
The pandemic has il ustrated the pitfalls of complex and “just-in-time” supply chains. It
appears to have shifted the balance from global value networks/supply chains optimised for
economic efficiency towards ones where resilie
THE nce is given greater weight.  Where the balance
wil  settle between these two considerations in the coming years is not yet clear.  Some
governments are using the opportunity to overlay geostrategic considerations on to existing
supply chains, sometimes with protectionist results. s6(a), s9(2)(d)

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13  Initial WTO forecasts s
RELEASED  uggested trade would fall 13-32% in 2020.   Statistics NZ data shows that
Aotearoa New Zealand’s  two-way trade fell 12.8% in 2020, with exports falling 9.4% and services exports
specifically falling 31%.  Total imports fell 16%.
14 Exports to Australia were down 18%; exports to China, Japan, Singapore, Thailand, Malaysia were down 7 – 9%;
exports to US were down 1% overall (though up 18% on goods); and exports to the EU were down 10%.
15 Tourism (“other personal travel”) fell 46%, while International Education was relatively less affected (down 19%),
likely in part due to some international students remaining in the country
s6(a), s9(2)(d)
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50
The impacts of the enormous international dislocation resulting from border and travel
restrictions wil  continue to spur behavioural and logistical changes around how people,
businesses and governments approach things like international travel (tourism), education,
working arrangements and global supply chains.  Behaviours and logistical arrangements are
unlikely to snap back to pre-COVID settings – even after the health threat diminishes.
51
Climate change and other environmental s6(a)
concerns wil  likely also
see increased consumer demand for low-carbon goods and services offered by inclusive and
socially-responsible companies. These issues wil  also factor more prominently on the
international economic agenda. Some companies wil  experience tensions between turnover
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(survival), profit, values and resilience.  Taken together, these tensions may set back R&D
efforts and slow the sustainable and inclusive liberal economic agenda.
52
Digital trade17 has been growing exponentially for several years as a key enabler of
trade. Crucially for Aotearoa New Zealand, it helps businesses overcome the challenges of
scale and distance and to enter global markets that were previously accessible only to larger
businesses, thereby supporting business growth and market diversification.   In a COVID
environment, it has enabled companies to continue to trade, even as shops remain closed and
has thus been a significant economic protector.  Going forward, digital wil  become an even
more important part of the global trade environment, a fact that drove Aotearoa New Zealand
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to lead the development of the Digital Economic Partnership Agreement (DEPA) as a blueprint
in this area.
What this means for Aotearoa New Zealand
53
The international trade space presents both big risks and big opportunities for Aotearoa
New Zealand. As a key proponent and beneficiary of open trade rules, s6(a)

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This is a period through which Aotearoa
New Zealand wil  need to bolster the resilience of the export sector against a range of issues
from climate change imperatives to geostrategic considerations.  s6(a), s9(2)(g)(i)

THE

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Policy considerations
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55
Working with like-mindeds, we need to bring all our technical expertise and trade
policy entrepreneurship s6(a)
to chart a path and
galvanise the membership to ensure meaningful deliverables in advance of and at the Twelfth

17 Digital trade here refers “digitally enabled” transactions, which can encompass virtually any area of international
trade and investment able to be conducted by or facilitated through digitisation (e.g., e-procurement, “software as a
service”, sale of goods through e-commerce platforms and cloud-based data storage and processing services).
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Ministerial Conference in December 2021 s6(a)

56
The biggest trade policy challenge for Aotearoa  New Zealand over the next 12-24
months wil  be to build economic resilience.  In particular, we will need to do more to develop
Aotearoa New Zealand’s capacity to manage disruption in our trade s6(a), s9(2)(d)


Diversification may be harder now in a post-COVID world
where creeping protectionism reduces opportunities and business balance sheets mean there
is less money for innovation, less appetite for risk and greater incentives to reduce complexity
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of transactions s6(a)

) is
essential.  We wil  need to continue working with New Zealand Trade and Enterprise and the
broader NZ Inc network to develop a work programme to support government responses.  s6(a), s9(2

57
On the trade negotiations front, concluding our FTA negotiations with the UK and
the EU are priorities over the next two years.  Efforts to attract more countries s6(a), s9(2)(d)

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to join other open plurilateral
initiatives of importance Aotearoa New Zealand (e.g., DEPA, the Agreement on Climate
Change, Trade and Sustainability (ACCTS) and the Inclusive Trade Action Group (ITAG)) are
starting to bear fruit and remain ongoing priorities.
58
We wil  need to continue work on supply chain resilience and non-tariff barriers
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as both wil  remain significant challenges.  The trend of increasing non-tariff trade barriers have
accelerated during the COVID pandemic and such barriers now cover s9(2)(d)

Aotearoa New Zealand exports.  Their relative impact wil  only increase as tariffs fall through
THE
successful FTA negotiations. The pandemic highlighted vulnerabilities in Aotearoa
New Zealand air and sea connectivity. The initial focus to maintain airfreight for critical goods
has shifted to a need for global insights to inform Al  of Government processes examining
medium-term disruptions to air and sea connectivity, a new National Freight Strategy  and
domestic resilience initiatives, as well as to manage opportunities and risks as countries re-
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shore and form new resilience initiatives and groupings.  Global insights wil  continue to be
needed once borders re-open as it is unlikely that connectivity wil  snap back to pre-COVID
patterns. These headwinds mean that supporting exporters wil  remain central to the
government’s Trade Recovery Strategy.
Investing in global rules and institutions that deliver for
Aotearoa New Zeal
RELEASED  and
59
The rules-based system, already under significant pressure, was dealt further blows
in 2020/21: s6(a)


18 It is acknowledged that the operational arm of the WHO has been at the centre of an effective global health
response, operating often in dangerous and complex circumstances.
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s6(a)
; and inequitable access to vaccines19 undermines international cooperation on
other issues s6(a)

iolations of human rights obligations that
have occurred in many countries are  deeply disturbing. Aotearoa  New Zealand has been
active in advocating for human rights norms to be upheld, including through UN organs and in
bilateral discussions.
60
Going forward, there is a balance of risk and opportunity in this domain.  The immediate
pressing challenge – and test – is global vaccine access. Inequitable vaccine access has the
ACT
potential to delay the global recovery; to promote a vaccine black market; s6(a), s9(2)(d)

  The ongoing
need for booster shots means the vaccine “solution” wil  not be one-off but likely an annual
occurrence for some time to come.  s6(a), s9(2)(g)(i)

61
Broader downside risks include populist nationalism, exacerbated by the economic
impacts of COVID, which wil  dampen international cooperation as populist leaders seek to
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show strength at home through pursuing tough lines internationally and blinkered national
interest agendas. s6(a), s9(2)(g)(i)

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THE

62
On the positive side, the establishment of the COVID-19 Vaccines Global Access
(COVAX)  facility; the conclusion of an  interim arrangement (the Multi-Party Interim Appeal
Arrangement, MPIA) to keep the WTO dispute settlement mechanism operating; the Al iance
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for Multilateralism initiative and the adoption of the UN75 declaration have been encouraging,
forward-looking outcomes.  s6(a)

combined with a
post-COVID resumption of physical summitry, may be sufficient to coalesce countries around
a particular issue or set of issues and reinvigorate international cooperation. A contender is
climate change in the lead up to and at the 26th Conference of the Parties (COP26) to the UN
Framework Convention on Climate Change (UNFCCC), with s6(a)
UK as host
RELEASED
particularly keen to deliver outcomes.

19  “Wildly unfair: UN says 130 countries have not yet received a single COVID vaccine dose”, The Guardian,
https://www.theguardian.com/world/2021/feb/18/wildly-unfair-un-says-130-countries-have-not-received-a-single-
covid-vaccine-dose, accessed 14 April 2021.

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s9(2)(g)(i)




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  Nevertheless, political participation remains strong.  Even given the health
implications of mass gatherings, the large-scale social protests of recent years have continued
around the world as citizens remain intent on addressing social injustices and pressing for
change.  Over time, a greater focus on equitable wealth distribution and well-being rather than
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GDP as a key success measure could shepherd in a period of considerable social and
economic reform.
What this means for Aotearoa New Zealand
65
Despite the challenges, Aotearoa New Zealand’s commitment to multilateralism and
the rules-based international system remains steadfast. Multilater
OFFICIAL  al outcomes may not always
be what we want and the process may at times be slower than we would like, but there is no
better means through which to promote collective action on global problems; to maintain
predictability and stability in global rules and nor
THE  ms; to constrain use of force; or to redistribute
power in ways that especially benefit smaller countries, including Aotearoa New Zealand.
66
New Zealand has become accustomed to a rules-based order that reflects our values,
supports our interests and amplifies the influence of small countries like ours. That order is
changing.  A weakening of the current s
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across the range of Aotearoa New Zealand interests, including territorial integrity (UNCLOS);
open and stable trade environments (WTO);  adherence to international humanitarian law
(various Geneva Conventions and associated Protocols);  the sustainable management of
global resources; cyber security and space rules; human rights; and climate change. The shift
also undermines Aotearoa New Zealand’s preferred means of operating through multilateral
approaches and frameworks that promote stability and collective action.
RELEASED
67
A coordinated effort with like-minded partners will also be needed s6(a), s9(2)(g)(i)

to regrow the declining number of
champions for human rights and democratic values.

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Policy considerations
68
In this s9(2)(g)(i)
environment, we need to be realistic about what we can achieve,
and we need a clear sense of where our priorities lie and what success (and failure) look
like for us. Our current priorities include:
•  Multilateral bodies and rules that support our interests and values (ocean
diplomacy (including UNCLOS), the WTO, climate change, the Organisation for
Economic Cooperation (OECD), biodiversity, space, disarmament and non-
proliferation);
•  A renewed focus on international human rights frameworks that promote
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fundamental issues of equality, fairness and human freedoms (especially the UN
General Assembly Third Committee and the UN Human Rights Council);

s6(a)

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•  Evidence-based approaches to global health security, adequate disease
surveil ance and ongoing investment in institutions, vaccines, therapeutics and
diagnostic capability, including in preparation for the next pandemic;
•  The Antarctic Treaty System, which s9(2)(g)(i)
OFFICIAL
and provides
for peaceful environmental and natural resource protection in Antarctica and the
Southern Ocean s9(2)(g)(i)

THE

•  Building on the success of the Christchurch Call, including as a foundation for
greater engagement with influential non-state actors to advance other core
international interests;
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•  Areas where success for multilateralism most likely lies, as a means to bolster
the system more broadly.  There may be such an opportunity on climate change.
Biodiversity and marine biodiversity are two other areas of importance to
Aotearoa New Zealand where progress is being made; and
•  Those areas that are important to our Pacific neighbours and where they rely on
s9(2)(g)(i)
Aotearoa New Zealand’s support (most notably but not limited to
climate change and aspects of ocean diplomacy).
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The risks to Aotearoa New Zealand’s security
69
Our Indo-Pacific region is a region rocked by protests – s6(a)

xacerbated by the economic impacts
of COVID, dislocation of populations s6(a)
wil  create humanitarian crises
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and could feed terrorism and people smuggling threats. s6(a)

70
Mis- and dis-information wil  continue to be exploited by malign state and non-state
actors to frustrate legitimate government objectives, reduce social cohesion and incite
violence. In the COVID world, anti-vaxx messages have a higher profile and are more
dangerous.  Any disinformation campaigns that target the effectiveness or safety of vaccines
could see this scenario emerge even where science might have predicted a significant vaccine
impact.  The need for COVID vaccine “booster” shots raises the spectre of ongoing challenges
related to vaccine effectiveness and supply, with incentives for black market or fake trade,
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especially when pandemic pricing of vaccines ends.  Transnational criminal networks wil
almost certainly seek to exploit demand for vaccines and vaccine documentation through black
markets and fake vaccines and certification.

s6(a), s9(2)(g)(i)

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  Climate change remains a significant and pervasive risk multiplier and
risk amplifier.
s6(a), s9(2)(g)(i)
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Policy considerations
73
An emerging and ongoing challenge wil  be maintaining international development
spending through a global recession so as not to exacerbate security and stability risks in
developing and least developed countries, many of which are already disproportionately
affected by the pandemic and in some cases, climate change impacts as well.
74
International security risks, including transnational crime, violent extremism and
RELEASED
terrorism, people smuggling and cyber security are on the rise, and in many cases have
been exacerbated as a result of COVID.  Aotearoa New Zealand has well developed policies
in each of these areas buts6(a), s9(2)(g)(i)

Risks have also increased in the
Pacific s6(a)

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75
As COVID has consumed governments’ attention, important technologies have
continued to evolve, outpacing domestic and multilateral efforts to understand and regulate
them.  Aotearoa New Zealand wil  need to step up our international engagement on rules
and norms applying to outer space and autonomous weapons if we are to have influence
on emerging multilateral frameworks in these important areas, as well as respond to increasing
demands from civil society groups in Aotearoa New Zealand.
76
Notwithstanding the profile provided by the Treaty on the Prohibition of Nuclear
Weapons, the environment for promoting nuclear disarmament and non-proliferation  is
inauspicious. This reflects increased strategic competition, reduced international trust and
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cooperation and the range of other pressing security concerns on the international agenda.  Yet
reducing the risk from nuclear weapons, and strengthening the norms against them, remain
key global security goals.  Aotearoa New Zealand wil  need to work even harder, and with a
broader range of partners, to ensure that nuclear disarmament is seen as not only possible but
also a priority – a task made more challenging by the further deferral of the Nuclear Non-
Proliferation Treaty (NPT) Review to early 2022.
Playing a credible role in global climate change action
77
The negative effects of climate change wil  be felt more acutely as each year without
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effective action goes by. The consequences of what is done – or not done – now wil  have
profound implications for humanity’s long term future. In this context, international and social
tensions related to climate change wil  intensify s6(a)

There may be
conflict induced by resource scarcity and competition, such as access to fresh water, s6(a), s9(2)(g)(i)
  The Pacific could also face a crisis at any time should a severe weather
OFFICIAL
event make a country temporarily or permanently uninhabitable.
78
The opportunities for meaningful progress on climate change look better over the next
THE
12-24 months than at any time in the past.  Despite the deferral of COP26, Paris Agreement
commitments and momentum towards enhancing global climate ambition has continued, with
several countries pledging more ambitious climate targets than the multilaterally agreed net
zero by 2050. A significant driver of this momentum has been the concerted diplomatic effort
by the UK as president  of COP26. The UK aims to host a COP that wil  herald a
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transformational shift in global climate action. Some major economies, including Argentina,
China, the EU and the UK, have announced enhanced Nationally Determined Contributions
(NDCs) for 2030, and others, including the US, Japan and Korea, have committed to doing so
ahead of COP26.  The Biden Administration’s decision that the US re-join the Paris Agreement
has also been a significant boost.
79
And, s6(a), s9(2)(g)(i)

RELEASED   the tide is turning on climate change as citizens increase demands
that their governments take action and there is a focus in many countries on a “green” recovery.
Similarly, “green” market forces are strengthening and businesses wil  ultimately respond.
Nevertheless, it is hard not to see other trends – not least the economic costs of COVID –
weighing on progress. Significantly, however, increasing competition s6(a)

in climate technologies may lead to faster global innovation and likely faster action s6(a)
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s6(a)

What this means for Aotearoa New Zealand
80
2021 is shaping up to be a critical “signalling” year internationally on climate change
policies.  Aotearoa New Zealand climate change positions wil  have read across to many other
areas of our foreign policy, s9(2)(g)(i), s6(a)

and our global brand and reputation, including as a trusted,
environmentally-sustainable supplier of healthy food.
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81
Climate change effects represent a greater existential threat, particularly for our Pacific
neighbours, than COVID. Thus the need for Aotearoa New Zealand assistance with climate
change mitigation and adaptation efforts wil  only increase (all the more so if global action is
insufficient to curb temperature rises). Aotearoa  New Zealand’s efforts internationally on
climate change as well as our domestic action wil  have significant bearing on our wider Pacific
interests.
Policy considerations

s6(a), s9(2)(g)(i)

INFORMATION
The UK COP26 Presidency’s finance and energy
campaigns provide potential platforms for showcasing Aotearoa New Zealand’s leading work
on climate-related financial disclosures and fossil fuel subsidy reform.  The COP wil  also
provide opportunities to profile Aotearoa New Zealand initiatives s
OFFICIAL uch as ACCTS and Aotearoa
New Zealand support for Pacific priorities, including decarbonising maritime transport, and
domestic climate change architecture.
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83
Nevertheless, we must be clear-eyed about the fact that international attention and
momentum is currently focused around national commitments. s9(2)(g)(i)

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COVID-19 impacts on our tools for pursuing our priorities
84
Notwithstanding  Aotearoa  New Zealand’s relatively successful adaptation to virtual
diplomacy, the platform’s shortcomings are becoming more acutely felt. A significant
diplomatic tool – the inward and outward high level visit – remains shelved by many countries,
including for  Aotearoa  New Zealand. Full-scale multilateral meetings are not amenable to
RELEASED
virtual format, s9(2)(g)(i)

  Nevertheless, an increasing number of countries have resumed in-person engagement,
including at the political level, sometimes even when managed isolation is stil  required on
return.
85
s6(a), s9(2)(g)(i)

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s6(a), s9(2)(g)(i)
.  s6(a), s6(b)(i)

86
In the meantime, high quality virtual engagement is being increased to compensate
for the extended length of time that physical meetings have been suspended and to ensure
relationships are established between counterparts where one or other is new. s6(a), s9(2)(g)(i)

.
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87
Our international relationships are the cornerstone of our foreign policy, without
which we can achieve very little. Aotearoa New Zealand needs to cultivate a wide network of
relationships and be a predictable and reliable partner to succeed in working collectively with
other countries to progress the intergenerational interests that successive New Zealand
governments have pursued. The principles of partnership and mutual respect that are
embodied in the Te Tiriti o Waitangi provide the foundation for how Aotearoa New Zealand
engages with international partners.  By recognising mana and exercising kawanatanga in a
manner that affirms tino rangatiratanga, we can manage and create strong, enduring and
productive relationships even when there are conflicting views.  s6(a)

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OFFICIAL
89
Coalitions and stronger relationships with a more diverse range of smaller countries
with which we also share (to varying degrees) a set of common interests and values, including
THE
a commitment to multilateralism, free trade, the rule of law, human rights and liberal democratic
values wil  be useful.s6(a) We can draw on previous productive partnerships, s6(a)

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90
The NZ Inc offshore network wil  continue to be a critical and unique resource for
Aotearoa New Zealand as our eyes, ears and voice in partner countries over the uncertain
period ahead. The impact on staff of working remotely in lockdown environments in many
locations for up to a year is acute and the Ministry wil  need to sustain its focus on supporting
their wellbeing.
RELEASED
21 MFAT (2019), Strategic Assessment 2030.

s6(a)

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91
The Ministry wil  also need to maintain the reprioritisation of resources to focus on
COVID  response and recovery work. We need to continue our efforts to support a
functioning and effective resident Diplomatic Corps and to facilitate efforts by the non-
residential Corps to recommence operations in Aotearoa New Zealand. Demand for consular
services is expected to remain  elevated. Aligning managed isolation capacity in Aotearoa
New Zealand with the level of demand from returning New Zealanders remains a key
challenge.  Ongoing prioritisation of work on vaccine strategy, safe travel zones, border policy,
supply lines and other COVID issues wil  constrain resourcing for other initiatives.
Conclusion
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92
COVID  has exacerbated and accelerated many of the negative global trends that
predated it.  The pandemic has created new ongoing social, health and economic risks; it has
highlighted the s9(2)(g)
(i)
state of global coordination and cooperation on pandemic planning; and it
risks diverting attention and resources from tackling the true existential threat of our time –
climate change.   Globally, the journey back wil  be a long one as the effects of high public
debt, high unemployment, disrupted education and long-term health and psychosocial
consequences of the pandemic create long-term drags on productivity and growth  and
generate conditions for greater unrest, criminality and violent extremism.
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93
The next two years of recovery and rebuilding wil  be difficult for
Aotearoa New Zealand. Our country’s  international security, prosperity and sustainability
interests wil  continue to be impacted even once vaccines are widely distributed and “normal”
international engagement resumes. First and foremost, our foreign policy wil  need to support
New Zealand’s economic recovery and resilience; the Pacific recovery and rebuild; and
vaccine access for Aotearoa New Zealand and the Pacific.
OFFICIAL
94
Our foreign policy wil  need to navigate intensifying geostrategic competition in the
Pacific and the Indo-Pacific, s6(a)

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95
The next two years is a critical period for multilateralism.  ss6(a)

RELEASED

this period of recovery, the international community
must comprehensively tackle climate change, while also preparing for the likelihood of another
pandemic.
96
Protecting and advancing Aotearoa New Zealand’s interests and promoting our values
internationally always requires strong bilateral relationships. We wil  need to continue to work
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with our close partners – large and small – to ensure ongoing cooperation and coordination
across the breadth of our foreign policy. s6(a), s9(2)(g)(i)

  In the
meantime,  ongoing effort wil  be required to sustain the MFAT and wider NZ Inc offshore
network.
97
s9(2)(g)(i)
  The world wil
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be focused on recovery and rebuilding in an environment destabilised by COVID impacts and
intensified geostrategic competition. We can support efforts to make it a green, inclusive and
equitable recovery and rebuild. But most of all, we wil  need to work  hard  toward greater
resilience across the breadth of our security, prosperity and sustainability interests, reinforcing
key interests and values and managing riskss9(2)(g)(i)

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