VZCZCXYZ0003
OO RUEHWEB

DE RUEHWL #0195/01 0711844
ZNY CCCCC ZZH
O 121844Z MAR 06
FM AMEMBASSY WELLINGTON
TO RUEHC/SECSTATE WASHDC IMMEDIATE 2516
INFO RUEHBY/AMEMBASSY CANBERRA 4335
RUEKJCS/SECDEF WASHINGTON DC
RHHMUNA/CDR USPACOM HONOLULU HI
RHEHAAA/NATIONAL SECURITY COUNCIL WASHDC
RHHJJAA/JICPAC HONOLULU HI

C O N F I D E N T I A L WELLINGTON 000195 
 
SIPDIS 
 
NOFORN 
SIPDIS 
 
STATE FOR EAP/FO A/S HILL, D (FRITZ), EAP/FO, AND EAP/ANP 
NSC FOR VICTOR CHA 
SECDEF FOR OSD/ISA LIZ PHU 
PACOM FOR JO1E/J2/J233/J5/SJFHQ 
 
E.O. 12958: DECL: 03/09/2016 
TAGS: PREL PGOV OVIP NZ
SUBJECT: SCENESETTER FOR A/S HILL'S MARCH 18-20 VISIT TO 
NEW ZEALAND 
 
Classified By: Ambassador William McCormick, 
for reasons 1.4 (b) and (d). 
 
¶1.  (C) The Embassy welcomes your upcoming visit to New 
Zealand, which will enable you to meet a broad range of New 
Zealanders, including academics, journalists, lawyers, and 
students.  Your meetings with GNZ officials will allow for 
productive discussions about regional/Pacific Island and 
security issues as well as the bilateral relationship. GNZ 
officials are anxious to ensure that your visit here will be 
both interesting and productive.  They regard you highly, and 
have followed closely your travels throughout the region. 
 
------------------ 
Political Scenario 
------------------ 
 
¶2.  (C) Having squeaked into a minority government with a 2% 
margin, the Labour Government remains relatively cautious and 
is not proposing any sweeping new programs or initiatives. 
It is not helped by Parliamentary rules that have cost a 
shrunken Labour its majority vote in all committees and the 
chair in some.  An emboldened opposition National Party 
continues to try to embarrass the Government.  Attempts to 
pick apart the governing arrangement have failed, as Foreign 
Minister and NZ First leader Winston Peters is a veteran 
Parliamentary pitbull and has out-debated his opponents.  But 
National's attack on Social Development Minister 
Benson-Pope's repeated attempts to cover up damning 
information about his allegedly inappropriate and abusive 
behavior while a teacher 20 years ago have silenced one of 
Labour's most aggressive, effective voices in Parliament. 
Indications that the economy may be taking a tumble are more 
serious for Labour.  Finance Minister Cullen says things are 
slowing down but not crashing, and admonishes analysts not to 
talk the economy into recession. 
 
¶3.  (C) Meanwhile, National's MPs tell us there is no truth 
to media rumors that Don Brash is facing a leadership 
challenge from Finance Spokesman John Key or Education 
Spokesman (and former leader) Bill English.  But the 
opposition is failing to articulate a clear, distinct vision 
for New Zealand.  This extends to foreign and security 
policy: the party caucus is debating whether to formally 
declare  support for maintaining New Zealand's anti-nuclear 
legislation.  Senior party officials tell us they have lost 
votes because of Government accusations that National wants 
to force a public referendum on the issue.  They believe if 
they remove the issue from debate they can more easily attack 
Labour for its anti-American tendencies.  They are, however, 
aware that a change in policy could work against their goal 
of rebuilding a security relationship with us.  They also 
know that Labour has already seized on the proposed change to 
claim National is untrustworthy and malleable. 
 
---------- 
Your Visit 
---------- 
 
¶4.  (C) Labour will continue to attack National over nuclear 
flip-flops, but we predict they will be on their best 
behavior with you on this visit.  We see no indication they 
intend to hijack your meetings for domestic political 
purposes.  Nor did they do so for the recent visits of CDR 
PACOM, CDR CENTCOM, or Codel McCain.  The PM and other 
Government officials are fully aware that their anti-American 
comments during last year's general election campaign were 
damaging to the relationship.  We have noticed a lot more 
positive comments about the United States coming from the 
Beehive these days.  This applies even to quasi-negative 
remarks:  Minister Peters, Defense Minister Goff, and others 
balanced their recent claims that the United States does not 
appreciate all New Zealand does in the Pacific Islands with 
the observation that we play a key role in the region. 
 
¶5.  (C) Minister Goff will be out of the country during your 
time here, and the Prime Minister will probably be unable to 
see you because she will be with Cabinet. You are however 
scheduled to meet with Minister Peters, and we predict he 
will repeat the claim that we should recognize New Zealand's 
active role in the Pacific Islands.  This seems to be the 
Government's new mantra encouraging us to overlook our 
 
differences on the nuclear issue, replacing last year's, "we 
agree on 95 percent of things, why focus on the negative?" 
It also builds on Peters' recognized strength as interlocutor 
in a region where he has many friends. 
 
¶6.  (C) But the Minister will not focus on the negative.  He 
clearly wants to improve bilateral ties with both the United 
States and Australia, and has personally reached out to me. 
In a recent speech, Peters said bilateral relationships are 
as important to New Zealand's interests as international 
institutions are, a heretical remark since many Kiwis regard 
the UN as helpful world government.  There remains little 
love between Peters and the press, but journalists seem to be 
developing a grudging respect for his abilities and his 
willingness to rely on expert advice.  MFAT contacts also 
tell us he has developed a good working relationship with the 
PM and Minister Goff. 
 
¶7.  (C) Senior MFAT officials also hope to start to build a 
good working relationship with you.  CEO Simon Murdoch and 
Deputy Secretary John McKinnon greatly regret that bilateral 
ties are not all they should be.  They have privately told us 
they think New Zealand should be thinking far more 
strategically about its relationship with the United States, 
including more cooperative efforts in the region.  Although 
they (and we) are obviously limited by the current 
Government's policies and outlook, we are encouraging Murdoch 
and McKinnon -- and other GNZ officials -- to build towards 
this goal.  For example, US Customs and Border Protection 
Assistant Commissioner Thompson recently discussed with GNZ 
possible joint CT-capacity building assistance in the Pacific 
Islands.  MFAT's CT Division tells us New Zealand might like 
to host a PSI planning session, but fears an embarrassing 
reaction from us.  The Ministry of Defense is concerned about 
Chinese military assistance and crime by Chinese nationals in 
the Pacific Islands.  These are the sorts of issues we 
believe could form a good basis for longer term US-NZ 
cooperation, even given the policies that divide us. 
 
 
 
McCormick