711.47H/9–2448
Policy Statement of the Department of State
New Zealand
a. objectives
The fundamental objectives of United States policy toward New Zealand are to maintain and strengthen the close ties of friendship which exist between New Zealand and the US; to encourage New Zealand, as an independent member of the British Commonwealth of Nations, to collaborate closely with the US on matters of common concern, particularly in the Pacific; to strengthen New Zealand, in association with Australia, as a friendly power in the Southwest Pacific; and to encourage the economic development of New Zealand and the growth of her foreign trade in accordance with the principles of the ITO Charter.1
b. policy issues
New Zealand is the most loyal of all the Dominions in its relations with the UK, which is its principal market and supplier of manufactured goods. The impact of the war on New Zealand thinking, while not diminishing the loyalty of New Zealand to the mother country, nevertheless has brought an awareness of the strategic dependence of New Zealand and Australia upon the US for defense in the Pacific and of the importance of maintaining close and friendly relations with the US and furthering cooperation between the two countries in matters connected with the Pacific area. As a result of the war New Zealand is also more closely allied with Australia and can be expected to share to some extent the apprehensions of Australia concerning the east-west conflict and the suspicion that the US is sponsoring restoration of Japan’s heavy industries.
[Page 10]1. Political
In the United Nations New Zealand has been one of the strongest critics of the veto. During the discussions of the veto in the Interim Committee of the General Assembly in March 1948, New Zealand proposed that the votes of two permanent members of the Security Council should be required to effect a veto. This proposal received no substantial support, but it remains close to the hearts of top New Zealand officials. New Zealand has taken an active interest in trusteeship matters and has been one of the most liberal of any of the administering authorities on the Trusteeship Council. It was on the prompt initiative of New Zealand that the former mandated territory of Western Samoa was placed under trusteeship. Further, New Zealand was most cooperative with regard to the special mission of the Trusteeship Council to Western Samoa in response to a petition for self-government addressed to the Council by the Samoans. The recommendations of the Mission were accepted by New Zealand and in large part incorporated in legislation passed by the Dominion Parliament.
In most of the issues before the United Nations in which we have been at variance with the USSR, New Zealand has been an outspoken supporter of our side. The effectiveness of this support has been somewhat reduced, however, by the smallness of the New Zealand delegation and their consequent reluctance to serve on committees. We have found the New Zealand delegation to be most helpful and cooperative on ECOSOC, UNESCO and other agencies of the United Nations. Outside the United Nations New Zealand has also cooperated fully with the United States and the other four powers in the South Pacific Commission.
With reference to our policies toward Japan New Zealand shares with Australia certain dissatisfaction with the present relations between the Far Eastern Commission and SCAP and has been critical of many of General MacArthur’s decisions. At the same time there are important differences in the attitudes of the two Dominions toward the problem of Japan. New Zealand as a predominantly agricultural country is not opposed to a revival of Japan’s industrial economy as such but insists on adequate security safeguards. Because of its fear of a possible Japanese military renascence, New Zealand, while advocating a greater voice for small powers in international affairs, realistically recognizes the importance of American security interests in the Pacific and is much less prestige conscious and desirous of individual recognition than Australia.
It is important that we have the support of New Zealand for our Japanese policies. Since our aims are not fundamentally opposed, there is every reason to believe that we can obtain such support provided we are careful to prepare the ground through diplomatic channels [Page 11] before new measures are adopted. Unheralded interim directives by SCAP should be avoided wherever possible. In any approach to the New Zealand Government and public opinion, emphasis should be laid on our efforts to democratize Japan politically and economically and to render her independent of continuous grants from the US.
There are seven Pacific Islands now administered by New Zealand to which the US has historic claims that have not been renounced: Atafu, Nakunono and Fakaofu, in the Tokelau or Union group; and in the Cook group, Penryhn, Manahiki, Danger (Pukapuka) and Rakahanga. Although the US claims to these islands were stated in a note to the British Embassy of August 16, 1939,2 we have not raised the question directly with the New Zealand Government. We should, however, avoid any action which might weaken our claims to sovereignty.
New Zealand claims a large section of Antarctica known as the Ross Sea Dependency, and was authorized by a British Order in Council of July 30, 1923, to administer the area, particularly for the regulation of whaling. New Zealand is also interested in Antarctica for strategic reasons as well as in connection with such scientific projects as weather forecasting and the study of cosmic rays. New Zealand has indicated that it might favor international administration in close relation with the United Nations.
2. Economic
New Zealand normally has a deficit on current account in her transactions with the dollar area, which she has met by drawings on the sterling area dollar pool in London. In order to reduce the deficit, New Zealand has imposed controls which allow only essential imports from dollar sources; unfortunately, through the operation of these controls the accumulated shortages of essential goods are expected to become so acute in the next few months as to cause serious dislocations in production. New Zealand producers have recently suggested the possibility of diverting a portion of New Zealand’s exportable surpluses of meat, butter and cheese (almost all of which exports in recent years have been going to the UK) to dollar areas, but it is reported that the British opposed the suggestion during recent bulk purchase negotiations. In formulating our attitude toward such measures, we should consider our strong interest in the financial stability of the UK and particularly ECA assistance now being given that country. On balancing all considerations, it is believed that our interest in reducing to a minimum New Zealand’s drawings of dollars from the UK is so great that we should not discourage her efforts to save and earn dollars.
Recently New Zealand revalued her currency to parity with sterling. [Page 12] Since it does not appear that this action will have any significant effects on her dollar deficit in the near future, no action by us is necessary.
It is our policy to encourage adherence by New Zealand to the multilateral trading principles set forth in the GATT3 and the ITO Charter. New Zealand’s principal sources of dollar earnings are wool and hides (which are not subject to the same exclusive purchase schemes as meat and dairy products). In GATT, the US made tariff concessions on wool, hides, and products of interest to New Zealand. We wish to encourage New Zealand to increase her exports to the United States and to widen their range.
New Zealand, though evincing continued interest in the Bretton Woods institutions, has not taken any steps to join them. We would favor the participation of New Zealand in both the Fund and the Bank, but since membership in these institutions has become a domestic political issue in New Zealand, it is difficult for us to encourage positive action by New Zealand. If New Zealand should join the International Bank and apply for a loan for long-term development schemes, we should support the application. We should also support applications to the Export-Import Bank for short-term loans to finance individual projects of an economically justifiable character.
American assistance in the economic development of New Zealand has been almost entirely through private capital. In the recent past, the capital flow from the United States to New Zealand has been in the neighborhood of $3 million per year. We should encourage private American capital to continue to participate in sound development projects or programs either through direct investments or through loans and other aids to New Zealand ventures.
A draft treaty of friendship, commerce and navigation was presented to the New Zealand Government in March 1948 as a basis for discussions.
c. relations with other states
New Zealand and Australia are bound by strong ties of friendship and share, in general, a common outlook on Pacific problems. The Australian-New Zealand Agreement of 1944 (the Anzac Pact), sets forth a comprehensive joint declaration of policy regarding the South Pacific. While no serious differences have arisen between the two countries, there has been an increasing reluctance on the part of New Zealand to accept unquestioningly Australian leadership in the Pacific, particularly in those instances where Australia has opposed the policies of both the UK and the US.
Both Australia and New Zealand are faced with similar problems [Page 13] concerned with adjusting their policies to the rising nationalism of the east. Although both restrict Oriental immigration, there is a distinct difference in attitude on the racial question; New Zealand’s experience with its Maori minority has given it a much more enlightened attitude. These differences, while significant, do not obscure the fact that cooperation between the two governments is continuous and increasing in conformity with the terms of the Anzac Pact. Thus they have recently engaged in economic discussions between themselves prior to making a joint approach to the UK on a revision of their bulk contracts, and they have participated jointly in the military field on such questions as preparations for the defense of Fiji.
New Zealand is generally considered the most British of the Dominions, and the most sympathetic toward Britain. Economically the relations between New Zealand and the UK have been particularly close. Predominantly agricultural New Zealand has shipped the overwhelming majority of its produce to the UK and has entered into long-term contracts with Britain to obtain assured markets for its dairy products.
New Zealand public opinion is not as strongly in favor of a centralized Commonwealth as are conservative elements in Australia, but it does support the need for some means of promoting closer agreement within the Commonwealth on foreign affairs and defense policies.
The desire for continuous consultation within the Commonwealth has been heightened in recent months by the prospect of British membership in a western European union and an anxiety over the political, economic and even military effects of such a connection on the self-governing dominions. It is not anticipated, however, that New Zealand will offer strenuous objections to a closer association of the UK with western European economy, particularly within the framework of present ECA commitments. A growing section of New Zealand opinion is becoming conscious of the advantages to be gained by a wider and rehabilitated European market for the Dominion’s agricultural produce.
New Zealand and the Soviet Union have exchanged diplomatic representatives and their representatives meet in international organizations and conferences. There have been few mutual economic interests, but the Soviet Union is sending a trade representative to New Zealand to purchase wool.
The Labor Government’s attitude on Communism is one of unequivocal opposition. There is general concern in New Zealand that Communism may spread among the native peoples of Southeast Asia, and thus eventually constitute menace of disturbing proportions. The Communist Party of New Zealand is small and has no parliamentary [Page 14] representation. It is, however, active and effective in the trade unions. The affinity of the trade union movement to that in Australia has led to some sympathy for Dr. Evatt’s4 contention that the US shares the blame with the Soviet Union for east-west tension. In general, however, the New Zealand attitude toward Russia is condemnatory and apprehensive.
d. policy evaluation
Our relations with New Zealand have always been most friendly and there has been very little discord in our immediate mutual relations, either political or economic. To the extent that we continue our present close cooperation with the UK we can be assured of a generally sympathetic attitude on the part of the New Zealand Government and public opinion. Earlier fears of US political and economic imperialism in the Southwest Pacific have been dissipated to a large extent in the last year, but there continues to be some fear that our Japanese policy may be directed largely toward building up Japan as a buffer against the Soviet Union with insufficient regard for the security considerations which are paramount in New Zealand’s attitude toward the reconstruction of Japan.
The increasingly vocal demands in Western Samoa for some form of union of the whole Samoan island group require care and tact on our part. Despite the relatively decreasing importance of Pago Pago as a naval base, we are not prepared to renounce our sovereignty in American Samoa. It is quite evident, moreover, that the natives in general do not wish us to depart. We are quite prepared, however, to see a closer degree of liaison between the native populations of the two territories. We authorized a number of native chiefs from American Samoa to accept the invitation of the Western Samoans to attend the ceremonial opening of the new Legislative Assembly in Apia last June.
New Zealand and the US share a common western European tradition, the heritage of the English common law and a like distaste for arbitrary power and violent change. Speaking a common language we also agree in the defense of such concepts as liberty and democracy. The national interests of our two countries in safeguarding and preserving the principles of democratic government are fundamentally the same. This means that in any issue involving a matter of principle their reactions are apt to parallel our own, provided, of course, that they are fully acquainted with the facts. New Zealand’s voting record in the General Assembly, particularly in the case of Greece, the veto and the Interim Committee, demonstrates this.
[Page 15]There are some points of difference, however, between our two countries. The concept of “free enterprise” in New Zealand is defined within the framework of the doctrines and program of the Labor Government and does not enjoy the same respect as in the United States. Furthermore, New Zealand’s deep attachment to Great Britain colors her attitude toward national and international problems as is exemplified by her support for Imperial Preferences.
Our approach, both to the New Zealand Government and to public opinion, should be designed to remove any suspicion that our policy in Europe and the Far East is dictated by a class or militaristic bias. Toward the government such an approach should be candid and should reflect a desire on our part that our motives be clearly understood and appreciated. Our information program faces a generally sympathetic public opinion in New Zealand and our approach should therefore be positive and open. The signing of the Fulbright Agreement with New Zealand on September 14, 1948 makes available a fund totalling $3,200,000 for educational exchanges. The keen interest of New Zealand in this program offers an excellent long-term medium for furthering United States-New Zealand understanding through the interchange of information and skills.
New Zealand can be of assistance to us in UN affairs and where we can anticipate the emergence of a major issue or where we wish to obtain New Zealand’s support for a project, greater use should be made of direct conversations here or in Wellington. New Zealand, as a semi-socialist state, devoted to parliamentary process, is not vulnerable to stock Communist propaganda and her support in UN, therefore, is of particular value to us.
- Documentation on the proposed charter of the International Trade Organization is printed in volume i.↩
- For text, see Foreign Relations, 1939, vol. ii, p. 317.↩
- Documentation on the General Agreement on Tariffs and Trade appears in volume i.↩
- Herbert V. Evatt, Australian Deputy Prime Minister and Minister for External Affairs.↩