China Business: Sir Don McKinnon: New Zealand's Chinese century

A Mandarin language class at Westlake Boys' High School.

New Zealand's shift to China is the most fundamental change to our external relations for at least two generations, writes Sir Don McKinnon.

This is the start of New Zealand's China century.

Economically, China's rapid emergence as our largest trading partner is equally significant to Britain's decline as our economic lifeline in the 1970s. What makes our shift to China even more profound is the cultural dimension that it brings.

China is our largest trading partner, our fastest growing source of tourists, our largest source of overseas students, and our greatest source of net migration.

Our prosperity, our social cohesiveness, our sense of who we are as a nation is increasingly dependent on how well we integrate this new Chinese dimension into New Zealand's economic and cultural life.

That integration is going on every day. It's occurring in the work of private companies trading with China, in our boardrooms, scientists collaborating, students studying, government officials making our interactions easier, and the cultural dynamic helping us understand each other better.

With so many threads now connecting New Zealand with China, who leads the relationship - government or the private sector?

The answer is that neither is wholly responsible. Each provides an aspect of leadership that is interdependent on the other.

In 2012 the New Zealand China Council was established by Prime Minister John Key as an umbrella organisation to co-ordinate leadership of the relationship.

We do this by bringing together New Zealanders who are at the forefront of our developing relationship with China - businesspeople, academics, bankers, lawyers, scientists, parliamentarians, Maori leaders and Chinese-Kiwis.

Language
There are three pillars to the China Council's advocacy work, alongside our ongoing focus on trade advocacy. The first is Chinese language. For so long New Zealand has been comfortably monolingual - but to integrate better with China, we need more Chinese speakers. The China Council strongly advocates the need to increase the numbers studying Chinese in schools and universities, get more native speaking Chinese teachers into our classrooms, and we're advocating for Chinese to be seen as a priority language; also for companies to emphasise the employment of Chinese speakers in a wide range of positions.

Debate
The China Council's second pillar is the need for well-informed public debate. The speed with which the China relationship is growing brings with it the potential for misunderstanding. Though China and New Zealand have many shared interests, they also have vast differences in culture, business, and politics.

Giving New Zealanders access to clear, objective and non-politicised information about the relationship is essential to balancing debate at home.

Investment
The third pillar is maximising value from investment. China's investment in New Zealand while growing is very low relative to our trade in goods and services - both in absolute terms and relative to the size of the relationship. New Zealand's investment in China is similarly low.

Increasing capital flows between our two countries is good business. It strengthens two-way trade connectivity and ensures better access for New Zealand products and services to new and existing markets in China, and delivers much needed financial investment.

The council is currently developing the first bilingual guide for investors in both countries looking for the right connections and expertise. The council also conducts skills training for New Zealand companies investing in China.

Personally, I'm hugely optimistic about the future of New Zealand's relationship with China. Our initial success at the export and Government-to-Government levels shows the potential for increasing economic interdependence and cultural synergy.

And I'm optimistic that my grandchildren will be living in a more prosperous and more cohesive New Zealand as our China century advances.

* Sir Don McKinnon is Chairman, New Zealand China Council