ofInterestNZ

David Mahon: China will watch Election 2026 closely

Chinese officials are watching the 2026 election for a signal on whether New Zealand’s more United States-aligned security posture will become a permanent fixture. If they assess that it is, the trade relationship might be at risk. That’s the opinion of David Mahon, a Kiwi business consultant based in Beijing. “New Zealand–China relations are already at their worst stage since diplomatic recognition,” he told the Of Interest podcast. “At the moment, there's not some sword hanging over us, partly because China is so busy dealing with a massive geopolitical mess, as all great powers and smaller and medium sized powers are.” But Mahon sees two risks in the future: China could retaliate by blocking the import of some non-essential luxury goods, or it could simply become “indifferent” towards its relationship with New Zealand. “New Zealand sells a lot of things to China. None of them are irreplaceable. In the end, it's just milk. In the end, it's just fruit or honey. That's something that we need to acknowledge.” “If you look at our free trade agreement, the profit margin, the rationale for many of our companies trading with China is only based on the fact we pay no tax. If we lost that free trade agreement. We would lose much of our business with China”. Mahon doesn’t think the Free Trade Agreement is currently at risk but there are signs Kiwi businesses in China are nervous about the deteriorating relationship. An article written by China trade consultant Anna-May Isbey in a report published by the NZ Business Roundtable in China warned there could be direct consequences (https://www.wsj.com/world/asia/china-warns-new-zealand-against-squandering-trade-relationship-11654147681?utm_source=chatgpt.com) for geopolitical policies. “The language used by governments when navigating geopolitical tensions can have real commercial consequences. Exporters consistently express the view that New Zealand’s longstanding, pragmatic, and independent approach to international engagement should continue,” she wrote. This perspective contrasts against security analysts in Wellington and elsewhere who are increasingly concerned about China as a security risk, and want New Zealand to bolster its defence capabilities and diversify its export markets. Government agencies have linked China to both foreign interference and cyber espionage in New Zealand, such as hacking the Parliamentary Service (https://www.beehive.govt.nz/release/parliamentary-network-breached-prc) network in 2021. But a political pivot towards the United States, which began while Jacinda Ardern was Prime Minister, has been complicated by the country’s plunging popularity in New Zealand. The United States is now seen by Kiwis as more of a threat (https://thespinoff.co.nz/politics/10-06-2026/nz-suspicion-of-us-has-surged-in-trump-2-0-its-now-seen-as-a-bigger-threat-than-china) than China, according to an annual survey commissioned by the Asia NZ Foundation. Mahon believes New Zealand should “learn to do less” and avoid taking sides in geopolitical competition which doesn’t directly affect it. “Stop seeking the approval of these big countries that impress you so much, including Beijing … If we do less, and our need for the approval of other nations is less, then I think the navigation is going to be a lot simpler,” he said.