Trump, tariffs and trade: What to expect from this year's APEC summit

Analysis - Donald Trump will dominate talks at this year's APEC summit despite the president-elect being nowhere near Peru.

President Joe Biden will represent the United States at this weekend's talks, but with just months left in the top job, he will have little influence at the table.

As Trump's promised trade tariffs loom large all eyes will be on China's next moves - making Christopher Luxon's first meeting with President Xi Jinping all the more critical.

Just 12 months ago Luxon was hopeful his first APEC would be in San Francisco, but with coalition talks between Act and New Zealand First spilling into a third week it wasn't to be.

Instead he goes into this year's meeting with Asia Pacific economies - including superpowers of the US, China and Russia - with a year's worth of summits and leader-to-leader facetime under his belt.

While Luxon will never admit it, it does place him in a stronger and more diplomatically experienced position heading into his first bilateral with China's Xi Jinping.

"I think having lived and worked overseas for 16 years and knowing these markets very well...I'm always very engaged on global trade and the global security and geopolitical issues," he told RNZ.

Global security and geopolitics are changing though, and Luxon told RNZ he'll be watching closely in Peru.

"Post-Obama whether it's been Democrats or Republicans, there's been very much not wanting to pursue as much trade liberalisation through things like free-trade agreements. Clearly China has got an economic agenda as well, so it will be interesting to observe those dynamics, frankly."

As Luxon heads into his first meeting with President Xi, he will be mindful former Prime Ministers Sir John Key and Dame Jacinda Ardern both had close relationships with China's leader.

Their meetings tended to run into overtime and Key made several visits during his time in the top job, while Ardern and her successor, Chris Hipkins, both made visits to Beijing.

Luxon is preparing to do the same with him confirming to RNZ that he has accepted an invitation to visit China next year.

David Parker was foreign affairs minister during Ardern's time, and told RNZ his advice to Luxon ahead of the meeting was to remember New Zealanders have a reputation for openness, principles, and a degree of humility.

"I would expect he would bring those attributes to the fore in his discussions with China's leader - our largest trading partner who doesn't enforce tariffs on us."

The mention of a lack of tariffs is an important distinction given the threat of US trade tariffs under Trump.

"Other countries in Asia and around the Pacific rim, including New Zealand, will be worried about the prospect of a trade war. We'll be wanting to minimise those risks, including by speaking to other countries who might have similar concerns."

That puts a lot of onus on collective smaller economies - many of which will meet this weekend in Lima - to create their own power and influence.

"New Zealand, with Singapore and then Chile and Brunei, started what was called the P4, which led to the Comprehensive and Progressive Trans-Pacific Partnership - the CPTPP - so big trees from little acorns grow is the saying."

As the US looks set to become more protectionist under Trump, Otago University Professor of International Relations, Robert Patman, says the APEC meeting is more important than ever.

He thinks that protectionist agenda will also prompt a rethink for New Zealand.

"I think the government's desire for closer alignment with the United States and traditional allies is hitting a stumbling block and they may have to reconsider. Pillar two of AUKUS is now becoming very complicated and it will be very difficult for the government to sell the idea that we should more closely align with a country which is quite prepared to hurt our national interests."

As a result China will be seen in a whole new light in Peru.

"China is going to take the initiative at APEC. It is going to present itself probably as the champion of free trade, and since we champion free trade as well it's an interesting juxtaposition."

But while a meeting between Xi and Luxon is hugely important given its our largest trading partner, things also need to be kept in perspective, he warned.

"We must have good relations with China but not at any cost. We can't have master-servant relations with either China or the United States. China's a dictatorship, an authoritarian state, we have absolutely nothing in common politically."

Patman says New Zealand can't pretend it's going to be exempt from any trade tariffs imposed by the US, which makes other trading relationships more crucial than ever.

South America is one part of the world both he and David Parker agree there are trade gains to be made.

Timely then that the Prime Minister is jetting his way to Peru.

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