Taking the minimalist approach on China

In a continuation of the "duplicitous" way both National and Labour manage their relationships with China, it looks likely New Zealand will tighten the rules around foreign political donations, but carry on ducking for cover on the far bigger cybersecurity issues, says Peter Dunne.

Australia has been rocked this week by revelations of Chinese hacking of its top levels of government.

According to the Australian Signals Directorate (the country’s national cyber intelligence agency) the Federal Parliament of Australia, the Liberal Party, the Labor Party, and the National Party have all been the subject of recent hacks by Chinese state sponsored agencies.

Coming on top of the swirl of allegations about the previous links of newly elected Liberal MP Gladys Liu to the World Trade United Front, and through it to the Chinese Communist Party, and separate inquiries about allegedly undisclosed political donations by Liu, Australian Parliamentarians are understandably whipping themselves into a lather.

New Zealand has not been immune from its own major hacking issues. Last year, government agencies, the Ministry of Business, Innovation and Employment; Statistics New Zealand; Land Information New Zealand and the Ministry of Transport were all the subject of hacking attacks, although not necessarily from China.

However, the GCSB did identify links between the Chinese State Security Ministry and a long-running global campaign of cyber-enabled commercial intellectual property theft, so it would not be unreasonable to suspect Chinese hands behind some, or all, of the attacks on the New Zealand agencies referred to above.

The limp response at the time from the minister responsible for the intelligence agencies that the hacks and the findings from the GCSB’s investigations were not a surprise is perhaps best explained by the lackadaisical and ambivalent approach both Labour and National have chosen to adopt to reports and examples of mounting Chinese influence in our politics. Both have been afflicted by many adverse incidents in recent years.

Many will recall the instance of the case of Bill Liu, a man with money laundering convictions, who was granted New Zealand citizenship in unusual circumstances following the equally unusual intervention of a Labour government minister in the early 2000s.

Then, in 2014, there was the controversy surrounding businessman Donghua Liu, and reports of donations of up to $200,000 to both the National and Labour Parties. Suggestions of undue influence as a result eventually claimed the head of a National Party Minister.

More recently, were the claims by former National MP, Jamie-Lee Ross, regarding Zhang Yikun, who allegedly donated $100,000 to National in 2017 and apparently has direct links to the Chinese Communist Party. There have been further revelations this year about a $150,000 donation to the National Party from Chinese business and racing mogul Lin Lang, facilitated by then Trade Minister Todd McClay.

Reports circulating in the United States last year claimed that all briefings on China prepared for former Prime Minister Bill English ended up being seen by Jian Yang ...

National has also been dogged by ongoing speculation around one of its own MPs, Dr Jian Yang, who, in a former life, trained Chinese spies at an English Language Institute.

Rumours about Jian Yang’s role were revived in the wake of the not dissimilar allegations raised against the Australian MP, Gladys Liu, and the meeting recently in Beijing between National leader Simon Bridges and Guo Shengkun who is responsible for the Ministry of State Security.

This ministry is China's intelligence and security agency, which the United States Department of Justice has described as being like a combination of the CIA and FBI.

Reports circulating in the United States last year claimed all briefings on China prepared for former Prime Minister Bill English ended up being seen by Jian Yang, leaving a cloud remaining over his status.  

Nor has Labour been exempt from allegations of this type. Last year, the senior United States Senator, James Talent, known to be close to President Trump, told a Senate Committee hearing that one of the Labour Party’s major fundraisers had direct links to the Chinese Communist Party.

The picture that emerges from all this is of a willingness by both major parties to engage closely with Chinese individuals and agencies with an interest in New Zealand, to seek both their financial support, and active participation in the New Zealand political process. Both parties have given high rankings on their party lists to ensure the election of Chinese candidates.

On the face of it, there is nothing overtly untoward about any of the funding provided to National and Labour. It is, after all, good to be encouraging participation in the political process.

While eyebrows have been raised at the size of some of the donations and the way they have been secured, there is no concrete suggestion that they have breached electoral funding laws as they currently stand.

They have, however, raised the legitimate question of whether donations of whatever size to political parties from outside New Zealand should continue to be permitted in the laissez-faire way they currently are, or whether it is now time to severely restrict, or even outlaw completely, such donations in the future. For the sake of transparency and clarity, a complete ban on foreign-sourced political donations seems the fairest and most desirable outcome.

But curbing political donations is the easy bit of this equation.

Far more sinister and far more difficult and important to resolve is the matter of foreign intelligence or cyber intervention in the political process of sovereign nations.

That is not limited to China. Most countries, including New Zealand, do it to some extent or another. Obtaining information about what is going on in the politics of a particular country and then reporting it back to one’s masters is the standard trade of the diplomat, after all.

Where it becomes difficult and crosses the imprecise boundary of what is acceptable and what is not, is when a particular country resolves to become more directly involved than it should in influencing the turn of events, especially the outcome of elections, in another, through cyber-attacks or other related forms of disruption.

So, on the one hand, we seem willing to turn a blind eye to the more passive listening and monitoring operations carried out by the Five Eyes Partners as somehow acceptable, and what everyone does, but, on the other we object strongly to the prospect of Chinese technology giant Huawei being actively used in our 5G telecommunications upgrade, because of its known and feared links to the Chinese Communist Party.

It becomes even more difficult when there are Members of Parliament with strong links to the Chinese regime.

And then there is the economic aspect. China is New Zealand’s major trading partner, and it is clearly in New Zealand’s interests to foster that, and the wider political relationship that goes with it, especially as China continues to develop.

While cementing and expanding the growing economic relationship is vital for New Zealand – something China well understands – we are increasingly being drawn into China’s wider web to sustain that.

All of which makes speaking out against China’s more covert and anti-democratic activities (like the current suppression of freedom of expression in Hong Kong and attempts by Chinese sympathisers to stifle criticism of that within New Zealand universities) that much more difficult.

So, we resort to the minimalist, mealy-mouthed approach our diplomats are so good at.

Both National and Labour have a vested interest in keeping a cosy relationship with China. While cementing and expanding the growing economic relationship is vital for New Zealand – something China well understands – we are increasingly being drawn into China’s wider web to sustain that.

But then we still have our relationship with the United States to maintain, which is increasingly measuring the worth of its friends by the extent to which they back America’s mounting anti-China rhetoric, all of which should make for an especially interesting discussion between the Prime Minister and President Trump when they meet next week.

In the short term, therefore, New Zealand seems far more likely to adopt tightening the rules regarding offshore sourced political donations, as the way to seen to be dealing with the situation, while ducking for cover on the wider cyber security related issues.

That way, a lot of virtuous and noble noise can be made about sorting out the perceived problem of foreign money buying political influence, which the two main parties know the public is already uneasy about, while leaving the far bigger issues of cyber-threats and Chinese interference in our domestic affairs largely unaddressed, with the burgeoning trade relationship with China left consequently intact.

Cynical dealing certainly, but more a continuation of the duplicitous way both parties always manage their dealings with China, when in government. For both, it is all about smoke and mirrors, rather than Chinese whispers.

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