New Zealand Minister of Commerce on trade deal with China, China-Australia tensions

An overview of an Australian flag is seen outside the Great Hall of the People on April 9, 2013 in Beijing, China.

Feng Li | Getty Images

SINGAPORE – Nationalism is not the way to go in diplomatic relations, New Zealand’s trade minister told CNBC in calling for more multilateral trade and ties around the world.

In fact, the world needs to build its “general security” – especially now during the Covid-19 pandemic, Damien O’Connor told Squawk Box Asia on Wednesday, as part of CNBC’s coverage of the Davos Agenda of the World Economic Forum.

“Nationalism is not the way to go – we hope to build multilateral trade and diplomatic relations around the world and do our part,” added O’Connor, who is also the country’s agriculture minister.

In recent years, protectionism and nationalism have taken a prominent place, as countries like the United States and some in Europe focus primarily on their economies and domestic issues, sometimes to the detriment of cooperation and collaboration with others.

Experts call the tense ties between the US and China a new “Cold War” as tensions have spread from the commercial front to technology and other areas.

They also warned that the coronavirus pandemic will trigger more protectionist policies among countries, as they seek to limit the economic damage of the virus.

On Tuesday, New Zealand signed a trade agreement with China, which gives Kiwi exports greater access to the Asian economic giant. The deal paves the way for tariffs to be removed or reduced on many New Zealand products, ranging from dairy and seafood to wood.

Offer to mediate

The deal comes at a time when China is still involved in tense trade tensions with countries like Australia and the United States

Regarding the moment, O’Connor noted: “It sends a really clear signal to the world that China, and we, of course, support robust trade agreements … which are supported by good laws.”

Relations between China and Australia have soured since last year, after Canberra supported an international investigation into how China is dealing with the coronavirus pandemic. As a result, Beijing has been targeting for months a growing list of products imported from Down Under – imposing tariffs on wine and barley and suspending beef imports.

New Zealand has offered to mediate a truce between the two countries, saying that the Asia-Pacific Economic Cooperation (APEC) summit this year could be an opportunity for New Zealand to bring both parties to the table, according to Reuters .

Regarding New Zealand’s mediation offer, O’Connor said, “We have a … mature relationship with China and we have always been able to raise issues of concern.”

“I cannot speak for Australia and the way it conducts diplomatic relations, but clearly if they follow us and … speak … (with) a little more diplomacy from time to time and be cautious with words. I hope (they) may be in a similar situation, “he said

In the meantime, Australian treasurer Josh Frydenberg told CNBC on Monday that he will continue to defend his national interests, but would like to see strained relations with China improve.

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