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a purple toned island with the flag of kiribati and a cutout of Winston beters looking towards it with an admonishing expressions
Kiribati, a country with an undeniably cool flag, is having its New Zealand aid funding reviewed following a perceived diplomatic slight. (Image: Getty/The Spinoff)

PoliticsJanuary 29, 2025

Explaining the ‘diplomatic tiff’ between New Zealand and Kiribati

a purple toned island with the flag of kiribati and a cutout of Winston beters looking towards it with an admonishing expressions
Kiribati, a country with an undeniably cool flag, is having its New Zealand aid funding reviewed following a perceived diplomatic slight. (Image: Getty/The Spinoff)

 A cancelled meeting in the Pacific raises larger questions about aid, climate change and the role of China and the US in the world’s biggest ocean.

New Zealand is reviewing its aid for Kiribati after the president of the Pacific country declined to meet with foreign minister Winston Peters. What’s the context of this diplomatic disagreement, and who will it affect? Here’s a quick background.

Where is Kiribati?

Kiribati, pronounced Kir-i-bas, is about 4,000 kilometres directly north of New Zealand. This Pacific Island country is made up of 33 small islands across three million square kilometres of ocean, the world’s 12th biggest exclusive economic zone and filled with valuable fisheries. There are 107,000 I-Kiribati people on the islands – more than Tonga, but about half the population of Sāmoa. Kiribati has one of the lowest GDPs of any Pacific Island country, and receives different kinds of overseas money: direct aid, fishing licences, working remittance schemes and a small amount of tourism. Foreign assistance was about 32% of its gross national income in 2022. 

Banaba, a coral island that is part of Kiribati, was extensively mined for phosphate during the 20th century, with residents deported to Fiji. The phosphate fertiliser was sold to different countries, particularly New Zealand, Australia and the UK, which jointly owned the mining company responsible. The phosphate was almost all gone, with extensive environmental damage and only 10% of the island’s surface left, by the time Kiribati gained independence from the UK in 1979.

OK, so New Zealand played a role in the colonisation of Kiribati. What’s New Zealand’s relationship been with the country since it gained independence? 

New Zealand has given significant amounts of international aid to Kiribati, more than $300 million since 2010, and $53 million in the 2023/2024 financial year. A lot of this money has been targeted towards climate change adaptation, as Kiribati is just 1.8 metres above sea level on average, and salination of water, coastal erosion and smaller fish stocks put people living there at risk. 

New Zealand is one of the few countries with a full embassy in Tarawa, Kiribati’s capital, which opened in 1989. It grants “Pacific access” residency visas to some Kiribati residents each year, and Kiribati citizens can come and work in New Zealand’s horticulture industry under the RSE scheme, doing work like thinning apples and picking kiwifruit.

a stormy purple sky, with some houses on a pale islane and a pale turquoise swish of water in the foreground
Eita, a small village in Kiribati that becomes a separate island during high tide due to sea level rise.
(Photo by Jonas Gratzer/LightRocket via Getty Images)

Sounds like an ongoing relationship of New Zealand acting on its responsibilities to poorer nearby countries. So what has just happened with Winston Peters? 

Barbara Dreaver, 1News’ Pacific correspondent, reported that foreign minister Winston Peters had been trying to arrange a meeting with Kiribati president Taneti Maamau for a year. Peters was finally set to visit this month, marking the first official visit in five years. The two government representatives were going to discuss a $25m hospital upgrade New Zealand aid had paid for, as well as seasonal workers, on January 21 and 22. 

A few days before, however, the New Zealand embassy in Tarawa was told that the president was no longer available, but Peters could meet vice-president Teuea Toatu instead. After the difficulty arranging a meeting, this was interpreted as a “diplomatic affront”. Australia was offered the same arrangement, but unlike Peters, Australian deputy prime minister Richard Marles chose to meet with Toatu.

In response, the New Zealand government has said it needs assurances that the Kiribati government is actually committed to a relationship with New Zealand in order to continue the air programme, which is now under review. “The lack of political-level contact makes it very difficult for us to agree joint priorities for our development programme, and to ensure that it is well targeted and delivers good value for money,” a spokesperson from Peters’ office told RNZ.

low, curly clouds linger over the flossy surface of the sea, where a figure with their back to the camera stands in ankle depth sea, holding a yellow bag
Fishing off Bikeman islet, off South Tarawa in Kiribati. Reuters/David Gray, CC BY-ND

So to remove the diplomatic language, New Zealand gives Kiribati lots of money, and is now frustrated that Kiribati doesn’t want to talk to it about future plans. Given that New Zealand is a major partner, why is Kiribati doing this? 

It’s worth noting, first, that Kiribati’s education minister Alexander Teabo has said the denied meeting wasn’t an intentional snub, but a calendar clash: Maamau had to attend an important event on his home island.  Most reporting around New Zealand and Kiribati links this shift to Kiribati’s relationship with China. Like several other Pacific countries, Kiribati recognised Taiwan as an independent country until 2019, and in return received more aid and support from Taiwan. In 2019, Kiribati decided to recognise China instead, which now has an embassy in Tarawa. Taiwan said that China had offered Kiribati aeroplanes and boats to switch allegiances

Since being recognised, China has committed more than $107m to Kiribati, funding disaster resilience, student travel to China and money for new boats and jetties. 

There are always people talking about China having too much power in the Pacific – are those fears actually well-founded? Or just a way to implicitly say that New Zealand, Australia and the US don’t like not being the only big powers in the Pacific? 

Ah yes, the question every small country eventually runs up against: does “upholding the rules-based international order” just mean “keeping the American superpower happy”?  

Foreign policy experts like Marco de Jong have pointed out that the idea of New Zealand’s “traditional partners” being the US, UK and Australia doesn’t fit with a Pacific-centred view. Emphasising China as a threat to the Pacific and using this as a reason to have more military interventions like Aukus could “create the instability it’s professing to address”, de Jong told Te Ao Māori News in May. 

While it seems subtle, the New Zealand decision to review Kiribati’s aid funding following the diplomatic incident shows that New Zealand expects Kiribati to keep engaging with Western donor countries. Meanwhile, Jon Fraenkel, a Victoria University of Wellington comparative politics professor, told RNZ that revising funding “usually works in the reverse direction, to kind of push countries away rather than draw them in”. He pointed out that a decision from the New Zealand government might simply remind Kiribati that it “does have alternatives, both in China and elsewhere”.

Keep going!
Nah to yeah nah bro, yeah to nah yeah grow.
Nah to yeah nah bro, yeah to nah yeah grow.

PoliticsJanuary 29, 2025

Just some ideas to help NZ win the growthy-yessy arms race

Nah to yeah nah bro, yeah to nah yeah grow.
Nah to yeah nah bro, yeah to nah yeah grow.

Spitballing for Christopher Luxon’s growalition.

The scene: a recently elected government rubs its eyes at the start of the calendar year and strides out to reset the agenda in a big January address. Our luminous speaker stares out towards the horizon and declares: “We must go further and faster on growth.” 

The message is emphatic: “Kickstarting economic growth is this government’s number one mission.” But that comes with an important exhortation on mindset. Decision makers had “become used to saying no. That must change. We must start saying yes.”

Who is this? Not Christopher Luxon, nor Nicola Willis, but Rachel Reeves, Willis’s counterpart in the fledgling UK Labour government, speaking this week

Does it point to parallel post-pandemic, inflation-and-cost-of-living-crisis-buffered economies straining to get the wheels turning again? Probably. But my focus here is much more shallow: who can win the sloganeering arms race? Where Obama had hopey-changey, New Zealand and Britain are battling to own the growthy-yessy mantra. Here’s how we win.

Luxon is plainly up for the task. The first week back in the seat last week was festooned with invocations of growth and saying yes, culminating in a state of the nation speech that arrived like a giant word cloud pregnant with growth and its sidekick yes. (“Turbocharging New Zealand’s economic growth is the key to brighter days ahead.” “The bottom line is we need a lot less no and a lot more yes.”)

Willis adds to her LinkedIn profile “minister for economic growth”. In May she’ll present the “growth budget”. Meanwhile, Luxon’s opening address to parliament was popping at the seams with growthisms. “Core to our plan is unleashing economic growth,” he said. You’re going to hear this a lot in 2025. I know this because he posted a video saying, “You’re going to hear this a lot in 2025.”

“We say a big yes,” said the prime minister. “We say a big yes to New Zealand businesses, big and small – that they thrive and they make a profit and they pay higher wages and they hire more people and they invest in more growth – because that’s what it’s all about: growth. And it’s awesome we’ve got Nicola Willis leading our economic growth plan, because we’ve got a plan to make it happen. And that’s what 2025 will be all about: growth trumps everything.”

Update: Yes

And just when you thought the day might get derailed by conflict among the governing parties on privatisation – after all, Winston Peters did say at parliament yesterday, “I spent my whole career ensuring that our assets stay in our possession,” and David Seymour did scoff at “low-quality debate [from] people talking endlessly about privatisation as if it is some enormous evil” – Luxon unsheathed his pièce de résistance: “I’ve got to say, we are a coalition on this side; they’re a no-alition on that side – that’s what they’re about. They’re all about no. We’re all about yes on this side.”

Luxon’s mic-drop yesterday (sorry, yesterday) proved that he and his team have what it takes to win the growthy-yessy rhetorical war. But more can be done. Play the national anthem: some ideas follow.

To begin: if they’re the no-alition, it stands to reason that Luxon is leading the grow-alition. And while one of the opening policy salvos was throwing open the border to digital nomads, the full potential here is unrealised. We should be embracing digital yesmads and digital growmads. 

This year is all about saying no to yeah nah bro and yeah to nah yeah grow. The month after October will be Yesvember and the one after April shall become Will. 

Ministers will be known as maxisters. The Reserve Bank becomes the Gregarious Bank. MBIE is out, DFNTLY in. Goodbye Business Roundtable, hello Yussiness Roundtable. The emerging talent James Meager will become James Abundant. The tourism strapline: 1000% Pure. 

Canterbury? Can-erbury, more like. Gore becomes Goer, Lower Hutt becomes Upper Hutt and Upper Hutt becomes Upperer Hutt. 

Not even becomes even. Fucken oath is redrafted as fucken growth. And we will abandon the No 8 Wire mentality in favour of a Yes 8 Wire mentality.

OK, I can hear I’m being played off here. At the end of the day, we’re talking about being relentlessly positive for a brighter future. Let’s do this. 

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Toby Manhire
— Editor-at-large
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