China urges New Zealand to 'reject external interference' after Foreign Minister Nanaia Mahuta's concern of 'storm' on the horizon

China is urging New Zealand to "reject external interference" after Foreign Affairs Minister Nanaia Mahuta expressed concern about a "storm" on the horizon.

In an interview with British newspaper The Guardian, Mahuta warned New Zealand could find itself at the heart of a "storm" of anger from China, potentially becoming engulfed by its deepening trade war with Australia.

"We cannot ignore, obviously, what's happening in Australia with their relationship with China. And if they are close to an eye of the storm or in the eye of the storm, we've got to legitimately ask ourselves - it may only be a matter of time before the storm gets closer to us," Mahuta said.

"The signal I'm sending to exporters is that they need to think about diversification in this context - COVID-19, broadening relationships across our region, and the buffering aspects of if something significant happened with China. Would they be able to withstand the impact?"

China is New Zealand's largest trading partner, accounting for nearly 30 percent of exports worth more than $33 billion. The value of exports to China is more than the value of New Zealand's next four trading partners - Australia, the US, UK and Japan - combined.

Mahuta's warning comes as New Zealand faces pressure to speak out more on alleged human rights abuses against Uighur Muslims in China's Xinjiang region, the erosion of democracy in Hong Kong, and the status of Taiwan. 

In a speech to the Chinese business community earlier this month, Ardern for the second time expressed "grave concern" for Uighurs, and said differences between China and New Zealand were "becoming harder to reconcile with".

China's state-affiliated Global Times newspaper tweeted a response on Tuesday to Mahuta's remarks from Foreign Ministry spokesperson Lijian Zhao, who urged New Zealand to not get sucked in to matters beyond its borders.

"China hopes New Zealand will continue to uphold principle of mutual respect & equal-footed dialogues, work together to make 'cake of cooperation' bigger and reject external interference."

It's not the first time China has pressed New Zealand to mind its own business.

Parliament earlier this month declared that "severe human rights abuses" were occurring in Xinjiang, and despite it being watered down with "genocide" removed, China reacted angrily, warning it would "harm mutual trust".

Ardern said the response was "not unexpected".

China similarly urged New Zealand to "stop interfering in Hong Kong affairs and China's internal affairs" after the Government suspended its extradition treaty with Hong Kong in the wake of deteriorating democratic rights.

But for all the heated responses from China, it doesn't compare to Australia, which after leading the call last year for an investigation into the origins of COVID-19, is now embroiled in a trade war with its top trading partner.

It's estimated China's trade sanctions on Australia cost around AU$47.7 billion in 2020. China has continued to rely on Australian iron ore, giving our trans-Tasman neighbours a buffer. But New Zealand is more vulnerable.

New Zealand's exports to China, such as dairy, forestry products and meat, could easily be replaced by another country, which appears to be why Mahuta is signalling Kiwi exporters to start diversifying into other markets.

But as the first Western nation to sign a free trade agreement with China, which was updated earlier this year, commentators have noted how the Government is balancing its relationship with China while exercising foreign affairs independence.

New Zealand's often softer stance on China than its allies in the Five Eyes intelligence group - which includes Australia, Canada, the US and UK - has led to jokes about us being 'New Xi-Land', a nod to Chinese President Xi Jinping.

Mahuta sparked controversy earlier this year for expressing discomfort with using the Five Eyes to criticise China. It came after Trade Minister Damien O'Connor ruffled feathers across the ditch for suggesting Australia practice more diplomacy with China.

Mahuta has since reaffirmed New Zealand's commitment to the Five Eyes. But while she has acknowledged China and New Zealand "cannot and will not" always agree, she says the relationship is "mature" and can withstand a few hiccups.