REVEALED: How New Zealand is even MORE vulnerable than Australia when it comes to upsetting China - with its tourism, seafood and kiwifruit at risk

China could easily punish New Zealand if it displeased the Communist Party dictatorship.

Like Australia, the nation led by Jacinda Ardern has China as its number one trading partner. 

New Zealand is even more vulnerable than Australia, which has a near global monopoly, for now, on the exports of iron ore, the commodity used to make steel.

Unlike its mining-rich neighbour Australia, the South Pacific nation's key exports can also be easily bought from other countries. 

China could easily punish New Zealand if it displeased the Communist Party dictatorship. Like Australia, the nation led by Jacinda Ardern has China as its number one trading partner. She is pictured with Chinese President Xi Jinping in April 2019 during a visit to Beijing

The Westpac bank said New Zealand would be particularly vulnerable if China imposed trade sanctions on its five million people, despite the two nations signing a free-trade agreement in 2008.

New Zealand exports at risk from angry China

HIGH RISK: Tourism, seafood, gold kiwifruits and university education

MEDIUM RISK: Wood, other fruits and meat

LOW RISK: Wine and diary

Source: Westpac 

'We judge that the tourism, seafood and export education sectors plus gold kiwifruit exports specifically have high exposure risk to China,' it said.

'Over recent years, China has in some cases restricted access to its lucrative market in order to advance its wider strategic interests.

'New Zealand's export sectors would be most at risk if the trade relationship changed and China chose to influence New Zealand trade flows.'

New Zealand's exports to China were last year worth $NZ20.1billion ($A18.5billion) before the COVID-19 pandemic struck, leading to an escalation of 'wolf warrior' diplomacy from Chinese President Xi Jinping. 

Tourism 

The tourism sector is in danger even though it only accounts for 14 per cent of New Zealand's exports to China.

Westpac senior agricultural economist Nathan Penny said this was because China was, until the coronavirus pandemic, New Zealand's fastest-growing tourism market.

'China has been one of New Zealand's fastest-growing markets and Chinese tourists are relatively high spenders once in New Zealand,' he said.

The tourism sector (Shotover River jet boat in Queenstown, pictured) is in danger even though it only accounts for 14 per cent of New Zealand's exports to China. Westpac senior agricultural economic Nathan Penny said this was because China was, until the coronavirus pandemic, New Zealand's fastest-growing tourism market

Wealthy Chinese tourists can also visit Europe or the United States should China discourage its people from visiting New Zealand.

'Moreover, New Zealand is a very small niche market compared to tourism heavyweights such as France, Spain and the U.S.,' Mr Penny said.

'In other words, Chinese tourists could comfortably fully divert away from New Zealand to any number of destinations globally.'

Seafood 

Seafood exports are also vulnerable, with China consuming 37.5 per cent of its exports from the ocean.

New Zealand's produce, however, makes up just 3.1 per cent of China's seafood imports.

Wealthy Chinese tourists can also visit Europe or the United States should China discourage its people from visiting New Zealand. Pictured are the ski fields at Queenstown

'The New Zealand seafood sector is highly exposed to China,' Mr Penny said.

'In other words, China can easily find substitutes for New Zealand seafood.'

Kiwifruit

New Zealand is synonymous with kiwifruit and people from the land of the long white cloud are often referred to as Kiwis.

This is despite the kiwifruit originating from China.

Imported Chinese gooseberry seeds in 1910 led to New Zealand's first fruit-bearing trees in the North Island city of Whanganui. 

The fruit, originally used in Chinese medicine, went on to be marketed as a kiwifruit.

In 2019, before the pandemic, China bought 32.9 per cent of New Zealand's exports of golden kiwifruit. 

In 2019, before the pandemic, China bought 32.9 per cent of New Zealand's exports of golden kiwifruit. Now China is growing its own version of the Zespri SunGold kiwifruits. The irony is kiwifruits originally came from China and were known as Chinese gooseberries

While New Zealand is the world's biggest kiwifruit exporter, it only accounts for 4.5 per cent of China's fruit imports.

Mr Penny said gold kiwifruit exports were particularly vulnerable as China grew its own unlicensed varieties of Zespri SunGold kiwifruit, with the 4,000 hectares cultivated there making up about two-thirds of New Zealand's volume. 

'At this scale, China is a competitive threat to New Zealand’s exports,' he said.

'While we classify overall exports as having low exposure risk, we classify gold kiwifruit separately as having high exposure risk.

'Indeed, gold kiwifruit is a special case for several reasons.' 

Gold kiwifruits last year accounted for 41 per cent of New Zealand's $NZ3.4billion ($A3.1billion) worth of fruit exports. 

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