A reshaping world for NZ
Hamish McNicol reports on New Zealand’s place in a less global world.
The tectonic plates of geopolitics have shifted. The United States is exhausted after its stint in charge.
China, the next cab off the rank, does not have the capability or the interest in being the next world power.
The world has changed, and New Zealand has no choice but to come along for the ride.
‘‘There is no clear balance in economic power like there was,’’ Stratfor vice-president of strategic analysis Rodger Baker said.
‘‘It’s a more diffused world, that creates a lot of opportunities but also a lot of volatility.’’
Baker was one of four international keynote speakers who would talk at this year’s CFO Summit, organised by Fairfax Media (publisher of Stuff) and Conferenz.
He has worked for Stratfor, which was short for Strategic Forecasting, for 19 years and leads its analysis of Asia-Pacific and South Asia.
The company’s primary purpose was to understand the future using geopolitics.
Baker’s CFO Summit talk, on what would be his first trip to New Zealand, would address how geopolitical tensions were reshaping this world, and what this meant for New Zealand.
The most obvious thing was the push back against extreme globalisation.
This had been seen in the US with the election of Donald Trump to president, and with Brexit.
He said this was ‘‘tremendously significant’’ for New Zealand because it was a country heavily dependant on trade.
China, not just the US, had also put more attention towards bilateral agreements, because by default of its size, it got more benefit from them.
‘‘If you look at the growth and pattern of international trade over the past 60, 70, 80 years… you really altered the way trade had been done in previous moments in history, and created these massive and very complex supply chains,’’ Baker said.
‘‘We’re seeing now a move back towards nationalism and regionalism and in that sense it’s going to start pushing against these globalised supply chains and back toward more localised and regionalised supply chains.
‘‘It doesn’t erase global trade, it doesn’t erase global interaction, but it does put an emphasis on some of these shorter run areas.’’
Baker, not wanting to belittle New Zealand a few weeks before he arrived, said the country, by dint of its size and location, would almost always have less clout in shaping trade relations.
New Zealand’s major exports, particularly agriculture and forestry products, were also at the mercy of consumers.
‘‘It may not be that it’s beneficial to be so heavily connected to China as a singular consumer, but to take the time and effort to create a large pool of additional consumers that overall may balance out the potential risk of overdependence.’’
Baker said the next five years would see a reshaping of the US from its role as the ‘‘global imperial centre’’.
Trump’s election accelerated this, which meant there would be increasing competition for power.
‘‘I think there is a uniqueness to it, we really are seeing, if the US pulls back, there is no singular global power that is going to emerge in its stead.
‘‘I don’t see the Chinese either being capable or, quite frankly, interested in filling that role.
‘‘There is a new phase in this flow of history that we’re entering into now where nationalism, subnationalism, rise, and regionalism becomes a way of managing all those issues, rather than a single dominant global power.’’
‘It’s a more diffused world, that creates a lot of opportunities but also a lot of volatility.’
The CFO Summit & Awards take place at SkyCity, Auckland on March 15. To register online visit www.cfosummit.co.nz