The suggestion that New Zealand might consider becoming Australia’s seventh state, offered recently as a wry commentary on the shifting global order under a potential second Trump presidency, underscores a growing debate about the country’s foreign policy future. Whereas dismissed by political leaders, the very discussion highlights a recognition that the established rules-based international system New Zealand has long relied upon is under increasing strain. As the United States navigates a period of internal political uncertainty and a more assertive China rises, Wellington is increasingly focused on bolstering relationships with other “middle powers” to navigate the evolving geopolitical landscape.
Canadian Prime Minister Mark Carney issued a call to action for middle powers at January’s World Economic Forum in Davos and reiterated it in a recent address to the Australian parliament, urging them to develop practical solutions to the new global realities. This resonates particularly strongly with smaller nations like New Zealand, traditionally committed to multiple alliances and independent foreign policy, and keen to explore collaborative approaches to shared challenges. However, the core question remains: how can these nations effectively cooperate when they remain heavily reliant on larger powers for security, trade, and crucial technologies?
A key challenge lies in the technological realm. Modern states are deeply dependent on semiconductors, artificial intelligence, 5G infrastructure, and cloud computing – technologies largely dominated by the United States and China. This dependence creates vulnerabilities and limits the strategic autonomy of middle powers. A concept known as “workarounding” – pursuing collective objectives without solely relying on Washington or Beijing – is gaining traction as a potential strategy.
For New Zealand, technology is already a significant foreign policy concern, particularly regarding military interoperability with Australia, a key factor in considering participation in AUKUS Pillar Two. The nation similarly faces the risk of falling behind in the rapidly evolving field of artificial intelligence. The Indo-Pacific region offers a promising network of potential partners to address these challenges, including India, South Korea, and the nations of ASEAN.
India, a major producer of IT graduates and with ambitious programs in semiconductor and quantum computing, maintains a multi-aligned foreign policy, resisting absorption into either great power orbit. A free trade agreement between New Zealand and India, announced at the end of 2025, is strengthening this relationship. South Korea, home to tech giants like Samsung, Hyundai, and LG, is widely regarded as a successful tech middle power and plays a vital role in international supply chains. New Zealand also has a trade agreement with South Korea and is part of the Indo-Pacific Four group alongside Australia and Japan. The ASEAN bloc, encompassing Singapore, Indonesia, Malaysia, Thailand, and Vietnam, demonstrates a strong institutional preference for hedging between major powers and represents a significant tech economy within the region. New Zealand maintains robust relationships with ASEAN through trade agreements and a Comprehensive Strategic Partnership.
However, Australia, India, South Korea, and the ASEAN nations all face their own technological dependencies. A crucial element missing from this group is a technologically capable anchor independent of the US-China duopoly. Here’s where the European Union (EU) could play a pivotal role.
While often described as a “hobbled giant” or a “geopolitical sleepwalker,” the EU’s unique status as a non-conventional state, lacking the military capabilities of great powers, compels it to adopt a multilateral and multi-stakeholder approach to geopolitics. The EU is also developing significant technological strength, particularly through its regulatory frameworks. The General Data Privacy Regulation (GDPR) has established a global standard for data governance that neither Washington nor Beijing has matched, shaping data flows, AI governance, and digital markets worldwide.
The EU is also investing heavily in hardware, exemplified by the 2023 European Chips Act, which allocates over €43 billion (approximately A$70 billion) to double Europe’s share of global semiconductor production, including the construction of a new plant in Dresden. Dutch multinational ASML’s near-monopoly on crucial semiconductor manufacturing machines provides Europe with significant leverage in global chip supply chains. The EU has been proactively strengthening its strategic autonomy and deepening its engagement in the Indo-Pacific, forging trade relationships and positioning European tech companies as alternatives to US and Chinese providers.
New Zealand’s relationship with the EU is currently at an all-time high following the implementation of a free trade agreement in 2024. The inaugural trade committee meeting in October 2025 highlighted cooperation on digital technologies and critical minerals as key priorities. This convergence of views and shared interests positions the EU as a valuable partner for New Zealand in navigating the evolving geopolitical landscape.
As Mark Carney rightly pointed out, the old assumptions are no longer valid. The challenge for New Zealand and other smaller powers is not to lament the passing of the old order, but to actively construct a more durable one. This requires a networked middle-power order built on shared standards, resilient supply chains, and strategic diversification. This approach will be critical for New Zealand to maintain its independence and pursue its interests in an increasingly complex and uncertain world.
The coming years will be crucial in determining whether this middle-power strategy can gain traction and provide a viable alternative to the dominance of the major powers. Continued dialogue and collaboration between nations like New Zealand, India, South Korea, the ASEAN states, and the EU will be essential to building a more balanced and resilient global order.
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