22 May 2024

New Zealand quietly added to US military trade law

6:52 am on 22 May 2024
USA, WASHINGTON, 2011-09. The United States Capitol is the building that serves as the seat of Congress, the legislative branch of the United States.
USA, WASHINGTON, 2011-09. Le Capitole des Etats-Unis est le batiment qui sert de siege au Congres, le pouvoir legislatif des Etats-Unis.
Photography by Riccardo Milani / Hans Lucas (Photo by Riccardo Milani / Hans Lucas / Hans Lucas via AFP)

The Ministry of Foreign Affairs says the US Congress acted on its own initiative. File photo Photo: Riccardo Milani / Hans Lucas via AFP

The US has included New Zealand under a military trade law that exists to "support [the] national security objectives of the United States" - without the New Zealand government's involvement.

Congress amended the law to add New Zealand to the US National Technology and Industrial Base (NTIB) 18 months ago.

The NTIB aims to ensure the "technological superiority of the US Armed Forces" and counter "growing threats", by boosting the United States' military-industrial ties with close allies.

The Ministry of Foreign Affairs said the US Congress acted on its own initiative.

"The New Zealand government was not involved in the process of New Zealand's inclusion in the NTIB," the ministry said.

But top spy and defence officials told the US State Department a few weeks ago that "New Zealand was pleased to be included... in recognition of our close strategic partnership", an OIA briefing showed.

Australia and the UK were included in the NTIB in 2016. Canada has been part of it since it started in the early 1990s.

Documents show the expansion has been driven in part by fears of China, with concerns "that allies and potential adversaries alike are achieving technological parity" with the US military.

'Not linked' to Aukus

A leading US analyst told RNZ that expanding the NTIB so that it matched the membership of the Five Eyes intelligence group had also boosted the Aukus pact, by making Congress more comfortable about sharing US military technologies with allies.

"So in that sense, including New Zealand was a success for furthering Aukus," said Bill Greenwalt, a former deputy undersecretary of defense for industrial policy.

But the US Embassy told RNZ the NTIB was "not linked to Aukus". It instead ensured "that there are no unintended barriers to multilateral cooperation".

"The Act allows US cooperation with other countries, where both countries assess it is their shared interests, but it does not require it," an embassy spokesperson said.

The Atlantic Council in 2019 went much further:

"Congress made it clear... that the seamless integration of the industrial bases of the United States, Canada, Australia, and the UK is needed to address growing threats," said its report by Greenwalt on leveraging the NTIB "to address great-power competition".

The threat from China is also a theme behind the Aukus military pact, in both Pillars One (for US submarines to be sold to Australia) and Two (to share advanced military technology).

China's ambassador in Auckland on Monday warned against "taking sides" by joining Aukus.

Prime Minister Christopher Luxon said on Tuesday there were different views between countries, and the view here was that Pillar Two was worth exploring.

"We think there is an opportunity for New Zealand."

Labour held this same position when in power, but has recently been distancing itself from that position.

Among the core US national security objectives that the NTIB supports is to "strengthen United States defense so as to further the comparative advantage of the United States in strategic competition with the People's Republic of China", according to 2024's authorisation of US military spending.

A US mechanism

Labour foreign affairs spokesperson David Parker said the NTIB was "a USA mechanism which they use. From the answers you have received from MFAT, it is not a government to government agreement".

A Green Party spokesperson said: "We were not previously aware of this, but Green Party MP Teanau Tuiono will be raising this matter with the Minister of Foreign Affairs."

The US Embassy spokesperson said the process of amending the law was transparent.

Including New Zealand "allowed the continuation of existing technological cooperation, and... also ensured that developing bilateral space cooperation was possible", they said.

A Congress explainer said the NTIB was about "supplying military operations; conducting advanced R&D and systems development to ensure technological superiority of the US Armed Forces; securing reliable sources of critical materials; and developing industrial preparedness to support operations in wartime or during a national emergency".

Members have been involved in F-35 joint strike fighter programme and the Pentagon is only allowed to buy satellite "star trackers" and certain naval components from approved NTIB manufacturers. Dual-use technologies that also have non-military uses are a focus.

US bureaucracy

But commentators say US bureaucracy has hamstrung the NTIB, with a Sydney University thinktank in 2019 saying this had hampered the whole Australian military from accessing US technology.

Defence Minister Judith Collins last month met top US military leaders, and her briefing notes said New Zealand was "integrating the capability development more closely with the US than in previous decades".

An briefing released under the OIA said it was an "opportunity to register the broad parameters and implications of New Zealand's foreign policy reset at a very senior level in the US State Department", and "to spotlight areas where we might be looking for further engagement from or with the US".

Bill Greenwalt has long argued in Washington for New Zealand's inclusion to "reinvigorate" the NTIB.

Greenwalt said in a 2022 paper that New Zealand was left out when the NTIB expanded in 2016 because the US - worried about a weakening military - was in a hurry and also did not understand New Zealand's "defense-industrial base".

He told RNZ he was not surprised New Zealand got added without fanfare to the NTIB.

"I sincerely doubt there were any discussions with your government before Congress acted," he said by email.

"The idea in essence is that if we can trust these countries with some of the US most significant secrets, we should also be able to trust them with less stringent security information about weapon systems development, production and operations.

New Zealand probably registered little change, he said.

However, aligning the NTIB with Five Eyes had helped the US Congress accept the rationale of giving its allies a break from export controls, a move required to implement the Aukus pact, Greenwalt said.

"How NZ wants to participate in NTIB or Pillar 2 is up to not only the NZ government but also how the US State Department adopts to this new change of views in the US Congress."

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