IN DC VISIT, NEW ZEALAND OFFICIAL TO SEEK USG

C O N F I D E N T I A L SECTION 01 OF 03 WELLINGTON 000794

SIPDIS

STATE FOR D (FRITZ),EAP/ANP, EAP/EP, EAP/RSP, INR/EAP
STATE PLEASE PASS TO USTR-LCOEN
NSC FOR VICTOR CHA AND MICHAEL GREEN
SECDEF FOR OSD/ISA/LIZ PHU
PACON FOR J2/J233/J5/SJFHQ

E.O. 12958: DECL: 10/12/2015
TAGS: PREL PGOV NZ
SUBJECT: IN DC VISIT, NEW ZEALAND OFFICIAL TO SEEK USG
VIEWS ON BILATERAL RELATIONSHIP, NUCLEAR ISSUE AND FTA

REF: A. WELLINGTON 635


B. WELLINGTON 452

Classified by Charge d'Affaires David R. Burnett. Reasons:
1.4 (b) and (d).


1. (C) Summary: New Zealand Deputy Secretary for Asia and
Americas John McKinnon will visit Washington from October 17
to 20. He will seek U.S. views on evolving regional security
architecture and the potential for improving the U.S.-New
Zealand relationship. McKinnon will acknowledge that all
issues should be on the table in discussions of the
relationship and, while there is no immediate prospect for
New Zealand's repeal of its anti-nuclear legislation, he will
want to hear why the legislation is still significant to the
U.S. government. McKinnon also will seek a frank assessment
of New Zealand's chances for free-trade negotiations with the
United States. New Zealand remains concerned with its public
face if it were to enter dialogue with the United States
without knowing if a free-trade deal were a possible outcome.
End summary.


2. (C) In a meeting October 12 with the Charge, Simon
Murdoch, chief executive of the New Zealand Ministry of
Foreign Affairs and Trade (MFAT),said that although the new
government had not yet been formed, he knew that Phil Goff
would remain as foreign minister. Moreover, Murdoch knew the
government-in-waiting wanted to be seen as responding
constructively to Ambassador Swindells' suggestion for an
enhanced dialogue on the bilateral relationship, which he
made both to the Prime Minister and in his July 4 speech (ref
B). John McKinnon's visit to Washington is seen by the
ministry as part of that constructive response. (Note: The
Labour Party is negotiating with minor parties to form a
government after winning the most votes in the September 17
elections. End note.)


3. (C) As his visit's main goal, McKinnon -- the ministry's
senior official responsible for the U.S.-New Zealand
relationship -- will explore whether a durable process can be
set up for discussing the bilateral relationship and what
each partner can do to add value to that relationship,
Murdoch said. He added that New Zealand wants a constructive
relationship. While anti-American rhetoric from some Labour
candidates during the election campaign might have suggested
otherwise, New Zealand wants to think of itself as a friend
to the United States.


4. (C) Murdoch understood that U.S. officials in Washington
viewed the New Zealand government as making a serious effort
in pursuing possible dialogue and were prepared to receive
McKinnon on that basis. "We've gone down this track as
realists, but what's significant is that we wish to get
things on a different footing," Murdoch said. Whereas State
officials had told New Zealand officials that McKinnon should
not come to Washington unless he had something to say,
Murdoch remarked, "We'll come with what we can say. It's not
for us to determine whether we have enough." The Charge
noted that Washington officials have a lot on their plates.
He underscored the importance of McKinnon either making clear
what New Zealand can do for an enhanced relationship or, at a
minimum, coming away from the visit with recommendations to
the new Cabinet on what it will take to keep Washington's
attention.


5. (C) Acknowledging that the United States would want to
include New Zealand's anti-nuclear policy in bilateral
discussions, Murdoch said all issues would have to be on the
table. McKinnon will ask USG officials why New Zealand's
anti-nuclear policy remains a matter of importance and
concern to the United States. McKinnon hopes to bring back
an explanation that will register with his government's
leaders, Murdoch said.


6. (C) However, Murdoch noted that repeal of the anti-nuclear
legislation would not occur under the incoming government.
While such action might have been possible before the
September 17 elections, the campaign "sharpened" the issue
and made a change unlikely, Murdoch said. He expects that
when the government returns to business and he asks Goff
which issues he considers to be mandated by his
constituencies, the preservation of New Zealand's
anti-nuclear policy will be among them. The Charge said he
hoped this would not preclude the government from thinking
about what it could do, if anything, short of repeal to meet
U.S. concerns.

7. (C) Murdoch said that, in any dialogue, New Zealand will
want to discuss our countries' common interests, particularly
in the Pacific region with the security architecture
changing. New Zealand is looking out for its own interests
in trying to demonstrate its value as a contributor to the
region's security and development, since it would be easy for
larger powers to marginalize the small country. The Charge
responded that it would be helpful for McKinnon to spell out
that motivation -- that New Zealand is acting out of its
interests rather than out of ideology -- during his visit.
If he also could be specific about concrete measures that New
Zealand might take in response to changes in regional
security arrangements, the Charge said that, too, would be of
interest.


8. (C) McKinnon will draw attention to New Zealand's
contributions outside the region, including in Afghanistan.
Murdoch said he will make the point that "somehow, our
politicians have the sense that it doesn't seem to matter
what we do, to (receive) constructive signals that we are
valued." The Charge said that U.S. officials feel compelled
to thank New Zealand officials for their country's
contributions in Afghanistan at every meeting because there
was so little else to discuss.


9. (C) Murdoch asked the Charge what other issues should be
raised by McKinnon. The Charge suggested that, while it was
clear that New Zealanders desire to have some distance from
the U.S. government, each government needed to think about
how much distance is necessary or useful, and why. Murdoch
remarked that New Zealand is a relatively new country still
defining itself in relation to the world. He pointed out
that New Zealand and the United States collaborate closely in
the sharing of intelligence and that they could build on that
cooperation. The Charge warned that while such cooperation
had grown rapidly, it would likely run up against limits
imposed by the nuclear issue sooner or later.


10. (C) Finally, Murdoch said another objective of McKinnon's
visit was to ascertain New Zealand's ability to obtain
free-trade negotiations with the United States. The New
Zealand government wants to know whether it is a serious
prospect for a free-trade agreement and would not want
McKinnon returning home without its status clarified. "We
can take a candid comment on that," Murdoch said.


11. (C) New Zealand continues to believe what it was told by
the Deputy Secretary when he was the U.S. Trade
Representative: While the United States cannot commit to
free-trade negotiations at this time, they have not been
ruled out. Murdoch said New Zealand is also mindful of the
USTR's recent announcement on four other countries being
priorities for free-trade deals and of the closing window
before trade promotion authority expires. New Zealand simply
wants to know if it will be onboard the next sailing. The
Charge responded that it would be worthwhile to seek a clear
answer, but cautioned that the USG might not be eager to
close the door, even if New Zealand preferred a closed door
to the current uncertainty. He also urged New Zealand to
consider whether some of its concerns might be better handled
through bilateral investment discussions, especially if New
Zealand were not in the queue for free-trade talks.


12. (C) Murdoch noted that his government needed to figure
out how it would publicly manage the relationship if New
Zealand proceeded with dialogue with the United States
without the prospect of an FTA. In the meantime, he
suggested that McKinnon's discussions be conducted under
media and diplomatic radar. His government will describe
McKinnon's visit as taking advantage of an opportune time to
exchange views before the Pacific Islands Forum and the APEC
summit. (Note: The Assistant Secretary and Prime Minister
Clark are not scheduled to be at the Forum at the same time
and are unlikely to be able to meet. The New Zealand
government hopes the Secretary and PM Clark might meet during
the APEC meetings. We did not encourage that hope. End
note.)


13. (C) Comment: John McKinnon is a smart, reasoned and
pragmatic diplomat. His visit is an opportunity to provide
New Zealand with a frank assessment of U.S. views on the
bilateral relationship, the possibility of dialogue, New
Zealand's nuclear policy and its chances for a free-trade
agreement. The New Zealand government at times has had
unrealistic expectations of the United States, which have
contributed to the strain on our relationship. McKinnon's
visit presents a chance to quell those expectations and tell
it like it is.
Burnett