China-NZ relations: Should farmers be worried?

An international trade relations expert says New Zealand farmers shouldn't panic over speculation that relations with China are strained.

China is a major trade partner for the New Zealand - including in the dairy sector, which provides 11 percent of the annual consumption of dairy products in China.

Trade relations expert, Stephen Jacobi told Magic Talk's Rural Exchange that while there is a degree of nervousness, farmers shouldn't be overly worried.

"I don't think it's quite at the stage the more doomsday scenarioists like to paint", he said.

"China is clearly concerned about some of the decisions we have made in recent times," said Mr Jacobi. 

Some commentators say recent actions suggest that China is sending New Zealand a message of its dissatisfaction, something Stephen Jacobi said needs to be taken note of.

"It's always hard to read tea leaves, but we do need to exercise a degree of caution."

"I think the Chinese would have been somewhat concerned at the strategic defence policy statement that made certain assertions about China that they didn't like."

He said the decision involving Spark and Huwawei, and an announcement before Christmas about the GCSB suggesting that the Chinese Government was involved in cyber espionage have also contributed.

"All of these taken together caused a degree of nervousness and we've just got to take a deep breathe, think about our long terms interests in China.

"We have to make the decisions we need to make in our own national interests, but the issue is are we managing that relationship correctly?"

Watch the full interview with Stephen Jacobi.

Hamish McKay and Richard Loe host Rural Exchange, 6-8am Saturday and Sunday on Magic Talk with Carter's Tyre Service.