It is estimated that China will invest as much as US$2.5 trillion ($3.5t) in infrastructure across the region during the next decade. Picture / Getty Images
It is estimated that China will invest as much as US$2.5 trillion ($3.5t) in infrastructure across the region during the next decade. Picture / Getty Images
New Zealand's preferential position in the Chinese market is at risk unless we actively pursue our place in its epic Belt and Road Initiative, says a report by PWC.
Commissioned by the New Zealand China Council, Belt and Road Initiative is pitched as a first step toward a strategic plan to maximise the benefits of Beijing's massive global infrastructure push.
The Belt and Road Initiative (BRI) was announced in 2013 by President Xi Jinping, who described it as the project of the century.
It seeks to enhance economic growth across the traditional Chinese trade routes – over land to Europe and by sea down through the Pacific.
It is estimated that China will invest as much as US$2.5 trillion ($3.5t) in infrastructure across the region during the next decade.
"The relationship we have with China has grown incredibly rapidly under the impetus of the Free Trade agreement," said New Zealand China Council chief executive Stephen Jacobi. "But some new momentum is needed."
The reason for that was other nations were staking their positions with trade deals and positioning themselves in the framework of the BRI.
Planned projects like a fast rail link from Beijing to Europe had the potential to shift the balance in trade with China, Jacobi said.
"It requires us to take another strategic look at what we can do with China, particularly as Belt and Road becomes the prism through which China looks at the rest of the world."
The massive investment in infrastructure through the region was likely to be focused on developing nations rather than countries like New Zealand, Jacobi said.
So the report focused more on New Zealand's connectivity with China and the 69 BRI countries.
The Belt and Road Initiative (BRI) was announced in 2013 by President Xi Jinping, who described it as the project of the century. Picture / AP
The report identifies eight specific initiatives under four categories where New Zealand can expand its connections.
These include trade facilitation in areas like biosecurity, customs clearance and supply chain hubs as well as a focus on innovation and the creative sector.
The report recommends quite specific steps such as creating interactive video games to promote New Zealand's place within the BRI.
New Zealand should also use its geographic position to act as a conduit and natural connection between China and South America.
"From a trade perspective, the NZ China pathway is already well defined with a Mutual Recognition Agreement and Joint Electronic Verifications in place," the report said. "Similar processes should be extended into South America."
As well as boosting trade the development of a connecting hub between China and South America would have a secondary effect of encouraging more tourists from both places.
Jacobi acknowledged there were diplomatic issues which required New Zealand to tread carefully as it developed the BRI relationship.
The US and Australia have concerns about the BRI being used to grow Chinese political influence in the region.
Jacobi said he hoped the report would be useful to the Government which was currently working on an official Memorandum of Arrangement with China.
This was a process - begun in March 2017 - of upgrading the FTA, expanding trade and investment and developing a plan for New Zealand's inclusion in the BRI.
