FM PETERS TO ADJUST BEHAVIOR AS ELECTION NEARS

UNCLAS SECTION 01 OF 03 WELLINGTON 000154

SIPDIS
SENSITIVE

STATE FOR STATE FOR EAP/ANP
PACOM FOR J01E/J2/J233/J5/SJFHQ

E.O. 12958: N/A
TAGS: PGOV PHUM KDEM NEW ZEALAND
SUBJECT: FM PETERS TO ADJUST BEHAVIOR AS ELECTION NEARS


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Reftel: Wellington 141

1. (SBU) Summary. On April 8, Foreign Minister Winston Peters
repudiated the China-New Zealand FTA, widely hailed as the premier
foreign policy accomplishment of Prime Minister Helen Clark's Labour
Government. Clark was widely criticized when she appointed Winston
Peters as New Zealand's Foreign Minister following the 2005
election. Since then, Peters has proved his worth in the role, with
accomplishments such as helping to advance the US-NZ bilateral
relationship. Fears that the hard-boiled instincts Peters often
displays on the domestic political stage would injure New Zealand's
reputation aboard have not been realized. However, Peter's
high-profile rejection of the China FTA may herald a change in his
approach. With elections looming and his party's prospects sagging,
Peters will retreat from his ministerial role and become
increasingly partisan. Peters will seek to distinguish his party
from the Labour Party, which it supports in government, by
advocating opposing and possibly hostile views of present policy.
This will test his hitherto good working relationship with Clark,
despite their mutual professional respect. End Summary.
Choice of Peters Made Many Nervous
--------------

2. (SBU) For many New Zealanders Winston Peters is the embodiment
of: an anti-immigration and protectionist populist; a quick-to-anger
and bombastic performer; and an enthusiastic baiter of the media.
It came as no surprise then that Labour Prime Minister Helen Clark's
decision to give Peters the foreign affairs portfolio soon after the
2005 election, thus securing his small party's support for her
Government, was received with much derision. The critics claimed
that he would be too unpolished and brazen for the world of
diplomacy. They argued that the populist politician who had never
taken an active interest in foreign affairs couldn't make a
plausible foreign minister. Furthermore, they questioned whether it
was possible have a minister who is not part of the government
(Peters insisted that he would be a minister but not part of the
government, a sleight of hand to get around his pre-election promise
not to join a coalition). This arrangement, foreign policy experts
asserted, would damage New Zealand's international relations and
send mixed messages to capitals around the world. The reaction of
the opposition National Party at the time of the appointment - that
"putting [Peters] as minister of foreign affairs does huge damage to
New Zealand's international reputation" - was emblematic of the
anxiety many New Zealanders had about having Peters as their
country's top diplomat.
Nerves Settle Over Time
--------------

3. (SBU) As Peters warmed to his task as Foreign Minister, however,
such doubts began to subside. Despite predictions to the contrary,
Peters has caused no ugly scenes, offence or uncertainty in foreign
capitals. Nor has he damaged New Zealand international reputation
abroad. There has been the odd spot of trouble on his watch. He
got offside with Clark in February 2007 when he said Iraq would
slide "into total chaos" if the US withdrew. He also got into a
public row with journalists in the office of Senator John McCain in
July 2006. Such misdemeanors, however, have not been repeated.
Personal Attributes Shape Peters' Role
--------------

4. (SBU) Clark has helped to alleviate these uncertainties by
shrewdly maximizing Peters' personal strengths. She has tasked him
with duties that accentuate his strong suits: public-profile meeting
and greeting, flying the New Zealand flag, and building personal
relations with foreign leaders. Peters is neither a details man nor
an enthusiastic consumer of lengthy briefing literature. Nonetheless
he, along with senior minister Phil Goff who is a details man,
actively contributes to policy development. But ultimately, it is
Clark who commands New Zealand's foreign policy. She was, after
all, nominated by one of New Zealand's leading political
commentators as New Zealand's "finest foreign policy Prime
Minister."
Praised as Key Goals Realized
--------------


5. (SBU) Peters identified two main aims for himself when he took
up his new post: to improve relations with the United States, and to
do more in the Pacific. Measured against those two standards,
Peters has succeeded, probably beyond his or anyone else's
expectations. The US-NZ relationship has clearly deepened since
Peters became Foreign Minister. The particular strength that Peters
brings to the bilateral relationship is his aptitude for personal
diplomacy. He is credited in New Zealand for crafting an amicable
working bond with Secretary of State Rice, a relationship that
former New Zealand ambassador to the US John Wood described it as a

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"more than useful" relationship. Peters' warm relationship with
Ambassador McCormick has also been acknowledged as a positive
influence on the bilateral relationship. Although the upward trend
in the relationship was visible before Peters' became Foreign
Minister, the majority view is that he has made a special
contribution to improving relations with the US and justly deserves
credit.


6. (SBU) In the Pacific, Peters has industriously sought to either
establish or strengthen relationships with a range of Pacific
leaders. He has a genuine commitment to the region, one in which he
feels particularly at home. (Note. He often holidays in a South
Pacific and is especially fond of the Cook Islands, to which he
appointed as New Zealand's High commissioner his former party
colleague Brian Donnelly in February. End Note.). Peters has set
out to remind larger countries what New Zealand is doing in the
Pacific and how important the Pacific is. It was Pacific politics,
in fact, that prompted what was perhaps his boldest individual
initiative to date. In November 2006, Peters brokered a meeting in
Wellington between then Fiji PM Laisenia Qarase and chief of the
Fiji Defence Force Frank Bainimarama to try to avoid the coup
Bainimara was threatening. Although Peters' attempt to avert another
Fijian coup was ultimately unsuccessful, he nonetheless received
praise for his efforts. Moreover, despite the claims of some
observers that success was probably beyond Peters' or New Zealand's
power to prevent the coup, he did as well as any person could
possibly do to dissuade Bainimarama.


7. (SBU) Peters has also been praised for his efforts avowedly in
support of the U.S. to persuade the North Korea regime to implement
their obligations under the Six Party process and to disestablish
their nuclear capability. Most recently, he has won kudos for
securing a significantly enlarged budget for his ministry (Reftel:
Wellington 141).

Mindset Shift to Domestic Politics
--------------

8. (SBU) Another reason why many of Peters' critics have largely
been silenced is his ability to change styles between his foreign
affairs and his domestic political duties. The fear that the harder
edged instincts he regularly exhibits on the national stage would
cross over to the international stage has not come to pass in any
significant way. Peters has successfully de-linked his two
professional identities, as a politician he is frequently bombastic
and gaudy; as a diplomat he is more measured and, well, diplomatic.


9. (SBU) However, as the election grows closer and he focuses his
attention more on domestic rather than international concerns, his
political persona will become increasingly dominate. As minister he
must spend long periods overseas while at home his party stagnates
(his New Zealand First Party is presently very low in the polls).
This problem becomes more acute in election year. Peters, however,
knows how to revive it. He will drastically reduce his foreign
travel and ramp up the populism. He also knows that working the
diplomatic circuit overseas will not easily translate in votes at
home so he will look to other ways to revive his sagging political
fortunes.
To Back Away from Labour as Election Nears
--------------

10. (SBU) The relationship between Peters and Clark has thus far
been professional and mutually respectful. She has supported him,
and he has supported Labour. But as the election grows nearer this
relationship will likely be tested as Peters seeks to differentiate
his party from an unpopular Labour Party by becoming increasingly
politically independent, perhaps even openly hostile, to current
policy. With his political future at stake, Peters will inevitably
try to distinguish himself on one or two issues, promising to keep
National and Labour honest, and get enough party votes to get over
the five percent barrier needed to secure a return to parliament.
(Note. Most pundits believe that Peters is unlikely to win back the
electorate seat he lost in 2005, another way of returning to
parliament, and will instead focus on getting his party above the
five percent threshold to win one or more seats on the proportional
party list. End Note).

11. (SBU) One issue Peters is expected to address in order to
distinguish himself from Labour is immigration. Peters' party
deputy, Peter Brown, has already called New Zealand's growing Asian
population forecast "horrible" and has also criticized New Zealand's
"open immigration policies." Attacking the strength, of lack thereof
in his view, of the Government's immigration policy has garnered
support for Peters in past elections, and he is expected to repeat

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the dose for the upcoming election. Clark, as a liberal social
democrat, particularly despises anti-immigration electioneering
campaign theme.
The Rise of Peters the Protectionist
--------------

12. (SBU) As Foreign Minister, Peters presides over a Ministry of
Foreign Affairs and Trade that, under Trade Minister Phil Goff,
enthusiastically advances the causes of trade liberalization and
globalization. As politician, however, Peters is an economic
nationalist who has long argued that trading with low-wage
economies, like China, jeopardizes New Zealand jobs and industries.
His recent criticism, therefore, of the FTA with China came as no
surprise. Although support for the China FTA is growing among New
Zealanders, some are still harbor concerns about the impact the deal
might have job security. In an effort to appeal to these concerns,
as the election approaches Peters will make his protectionist
leanings more prominent and refer often to his doubts about the
quality of the FTA with China. Peters' began expressing his
opposition to the China FTA as soon as it was signed, and his stance
revived criticism of Peters' minister-outside-of-government status
and the freedom it allows him to speak out against certain
Government policies. Although Clark has largely weathered Peters'
opposition to the China FTA and the media criticism for allowing him
to do so, she should expect more of both during the election
campaign.
Comment: The Master Chameleon
--------------

13. (SBU) Overall, Peters has proved to be an adept and disciplined
Foreign Minister. As minister he has been ready to listen to MFAT,
according to his political Chief of Staff, but also keen to propose
and advance initiatives of his own. But as a party leader he can
also go tub-thumping and bombastic. His
minister-outside-of-government status, although somewhat
controversial, has become a rock solid device that allows Peters
live a political double life without damaging his party's
relationship with Labour. However, if he repeats the themes of
previous campaigns and inflammatory rhetoric of past electioneering,
as expected, that double life will be put to the test. The major
point of distinction here is that is past elections he was not
'part' of any Government. No Labour minister could get away with
what Peters gets away with, such as his open hostility towards the
trade deal with China; some have been dumped for far lesser
transgressions. Clark has valued loyalty above all else in her
government, and it is an open question how far Clark will let Peters
attack Government policy as election time draws near. Two key
factors will, however, moderate any breach of the Peters-Clark
relationship: she needs to keep his party's support to govern; she
knows he is also being mooted by National as a possible governing
partner and Foreign Minister. Nonetheless, there are likely to be
some awkward moments for Peters as he gradually shifts from his
ministerial role and revives his populist theatrics in order to
actively distinguish his party from Labour. He will need every
political skill he's gleaned or honed to make it work. However, if
there is one New Zealand politician capable of doing this it is
Winston Peters. End Comment.
McCormick