Transparency International announced yesterday that New Zealand is the least corrupt country in the world. This is excellent news, but New Zealand cannot afford to rest on its laurels.
Transparency International’s Corruption Perception Index assesses whether countries have a corrupt judiciary and public sector. Some other aspects where corruption can also occur, such as political funding, are not included in the index.
New Zealand’s international reputation for political integrity has taken a battering recently. The country’s minister of Justice, Andrew Little, admitted last month: “Like many democracies around the world, ours is vulnerable to those abroad who would seek to interfere in our democratic processes and influence the outcome.”
Responding to these very concerns, from 2018-2019 the New Zealand parliament held an extraordinary, highly controversial inquiry into foreign interference. It is obvious the country engaging in the political interference activities in New Zealand is China, but politicians and officials avoided mentioning this. Last month the New Zealand parliament passed new legislation to restrict foreign political donations.
Yet New Zealand continues to feature in international discussion of China’s political interference activities, profiled as a nation which is under threat from political interference and is struggling to adequately deal with it.
A Financial Times article this month said New Zealand was “on the edge of viability as a member” of its allied relationships because of its “supine” attitude to China and “compromised political system”.
New Zealand is frequently described as “the soft underbelly” of the Five Eyes, an accusation which some of New Zealand’s political pundits strongly reject. But perceptions matter, and the behaviour of some of New Zealand’s politicians does nothing to dispel international concerns.
New Zealand National party MP Todd McClay was featured in a report by Freedom House as an example of how the Chinese government forges relationships with foreign politicianswho promote Beijing’s views in local media.
McClay spouted China’s official line on Uighur mass detention in an interview, saying “the existence and purpose of vocational training centres is a domestic matter for the Chinese government”. McClay has never retracted these remarks.
“Vocational training centres” is the term the Chinese government uses to describe its detention of an estimated 1 million Uighurs in concentration camps. In 2019, two major leaks of official documents revealed China has placed the Uighur population under mass surveillance and internment, without charge.
McClay is also infamous for receiving NZ$150, 000 (US$99,000) from a China-based businessman, Lang Lin. The funds were given via Lang’s New Zealand-registered company Inner Mongolia Rider Horse.
New Zealand law allows donations via New Zealand-registered companies, even if they are foreign-owned. The prime minister, Jacinda Ardern, said Lang’s donation was “outside the spirit of the law”. But the country’s new legislation on electoral funding did not include changes to this massive loophole.
New Zealand prides itself on being known as the easiest place in the world to set up a company. It continually ranks first in the world for ease of doing business.
When the Panama Papers were released in 2016, New Zealand was described as “at the heart” of global money laundering. The ease for foreigners to set up a company in the country is one of the reasons why money launderers have been attracted to do business there.
New Zealand’s damaged political reputation persists, in part because neither the present Coalition government nor the main opposition party, National, have given a clear signal that they are serious about addressing China’s political interference activities.
In 2019, the leader of the opposition, Simon Bridges, attracted international ridicule when on a visit to China he unwittingly met with the head of China’s secret police. Bridges gave a craven interview with Chinese broadcaster CGTN where he repeated Chinese government talking points.
The New Zealand National party MP who famously hid his 15 years serving in Chinese military intelligence, Jian Yang, is possibly now more well known internationally than he is in New Zealand. Between 2008-2017, the New Zealand National party received at least NZ$1.3 million (US$855,000) in political donations from figures associated with China’s United Front Work Department. No other political party received this level of China-connected funding. Dr Yang is National’s main fundraiser among the New Zealand Chinese community.
You would think New Zealand’s other political parties would be making hay with all this material. But they have been mute. Not one MP mentioned the word China during the debate for the new legislation to curb foreign funding. Neither Ardern nor Bridges contributed to the debate.
Ardern needs to make a clear statement about China’s political interference activities in New Zealand and what her government is doing to address it.
The New Zealand government should also follow the advice of Transparency International-New Zealand (TINZ) and set up an Anti-Corruption Commission. TINZ recommends that New Zealand should reinforce the independence of the Police commissioner and provide better resourcing for the Electoral Commission, the Serious Fraud Office, the Financial Markets Administration, the office of the attorney general, and the ombudsman. This will enable these agencies to do a better job of the oversight and education required for protecting New Zealand from corruption, whether from within or without.
Confidently acknowledging that New Zealand is facing up to this challenge is a strength, rather than a weakness. It will help reassure the country’s international partners, as well as New Zealanders, that the government upholds New Zealand’s values and democratic institutions regardless of political pressure from China, or indeed any foreign power.
Professor Anne-Marie Brady lectures in Chinese politics at the University of Canterbury, Christchurch