Tuesday, November 29, 2005


By Ana Samways

To all those caring souls who have emailed the story of this girl, who was alone with no memory in a Phuket Hospital since the Boxing Day Tsunami, please stop as she has been reunited with her family and is safe and well.

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A reader from Herne Bay writes: "The well-heeled locals all saunter from their leafy villas and head to Jervois Rd to pick up the Weekend Herald and have a coffee or brunch at the numerous cafes. A popular hang out is 5 loaves and 2 fish where the footpath tables are full of Herne Bay-ites and it is also a popular stopping off point for those who walk their dogs. There are normally two or three of the canine coffee set loitering under the tables, but others arrive by way of BMW, Mercedes, or Audi. Last Saturday a Silver M-class Mercedes 4WD arrived with Derek and inside his new Doberman pup, Klaus. Derek spied his pals at a table kerb side, so popped the windows down an inch to give Klaus some fresh air, but left the keys in the car. Suddenly another dog came walking past with its owner and Klaus jumped up to look out, and his paws hit the automatic locking button on the doors, locking all four doors with him and the car keys inside. Imagine Derek's consternation? But all was solved when he hitched a ride on a mate's motor scooter home to get a spare set of keys.

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Apparently, some guy impersonating a cop has called dozens of fast-food restaurants over the last decade and told the manager that a particular employee was stealing and instructed the manager to strip search the accused. Amazingly, the managers obeyed. A girl celebrating her 18th birthday - in her first hour of her first day on the job at the McDonald's in Roosevelt, Iowa - was forced to strip, jog naked and assume a series of embarrassing poses, all at the direction of a caller on the phone, according to court and news accounts. The manager conducted a degrading 90-minute search of a waitress, though the man had called collect, and despite the assistant manager having read a company memo warning about hoax calls a month before.

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A reader writes: "Trying unsuccessfully to wrestle my 2 1/2-year-old into his PJs I managed to leverage some good behaviour by promising he could stay up to watch the Santa Parade at the end of One News. Having recently become acquainted with the idea of Santa, the boy was keen to clock the red guy in his 'dumb-boots'. One News promoted the item at every opportunity during the hour and we anticipated something great, but what we got was a half-assed effort, devoid of Christmas spirit and just a glimpse of the star of the show."

Editorial: Democracy promotes prosperity

The Commonwealth appears to have done better than Apec this month in pushing for urgent progress in world trade negotiations in Hong Kong shortly. It is unfortunate, therefore, that the Commonwealth Secretary-General, Don McKinnon, should downgrade the contribution democracy can make to economic success. New Zealand's representative at the heads of government meeting, Helen Clark, called her countryman's comment a "throwaway line" but Mr McKinnon says he does not do throwaway lines. He says he was misinterpreted.

In the speech at Malta the former National Deputy Prime Minister said: "Many people are beginning to ask whether building a democracy is really the road to prosperity. Does democracy put food on our tables, clothe our children, put roofs over our heads, or give us a future?" Trade was not just an engine for economic growth, but was the most potent weapon to combat poverty, he said.

He is right, of course, up to a point. It is possible to prosper without democracy, as China demonstrates today and as Hong Kong proved under British administration long before. Conversely, if proof was needed that democracy alone does not ensure mass prosperity it was long provided by the poverty of the world's largest democracy, India. But these are exceptions that prove the rule that democracy and prosperity go hand in hand. Developed countries that have sustainable economies built on more than a single commodity such as oil, tend to be democratic. And democracy in turn helps to generate a better economy.

Democracy alone might not put food on the table but it helps to ensure that the conditions of reliable food production and distribution continue. Democracy essentially invests every adult individual with equal power and status as voters. It requires that leaders be prepared to surrender power and position on the results of a popular vote. For that to happen, all political organisations must be confident that rivals will abide by electoral law. It is by teaching adherence to law that democracy can promote economic prosperity.

Adherence to a common law allows complete strangers to trade with each other, confident that agreements will be kept, goods and services will be reliable and payments made. In the absence of democracy political power is more easily used for private gain. Business and wealth will depend more on personal connections with the powerful than on the ability to sell in markets governed by law. Patronage and corruption will prosper.

A Chogm should be the last forum to hear a denigration of democracy. The Commonwealth is a collection of nations united by nothing except an experience of British colonialism. The organisation has at times struggled to find a cohesive, post-colonial mission but seemed to find one in the adherence to democracy and the human rights and freedoms that accompany it.

The Commonwealth has gone so far as to suspend member states such as Nigeria and Fiji for serious breaches of the democratic ideal. Now the organisation faces an awkward decision on Uganda, where the Government has just jailed an Opposition leader and where the next Chogm is to be held in 2007. It falls to the Secretary-General to carry the democratic demand to errant dictators in often poverty-stricken places and Mr McKinnon is probably weary of hearing the very arguments he put to the Malta meeting.

Neither democracy nor trade are instant remedies for poverty. A good level of popular education is needed for democracy to produce competent governments, and free trade forces painful adjustments on an unsophisticated economy. But lacking both democracy and open markets, the poor are doubly penalised.

Mike Moore: Open society better for all

Don McKinnon, Secretary-General of the Commonwealth, at the Commonwealth Leaders Conference in Malta over the weekend, suggested democracy alone did not put meals on the table. Wrong. There has never been a famine in a democracy.

However, what he said is worthy of study. Yesterday Mr McKinnon clarified his comments. "I have always stressed that democracy and development are two sides of one coin. People cannot eat democracy, but development cannot occur without freedom."

But many believe that there may be better ways than democracy of delivering economic progress.

During the period of the Cold War there was a sordid consensus that the development needs of newly independent colonies were best met by strong leaders. It's called the "authoritarian advantage". Alas, a squalid but elegant economic theory emerged to justify this proposition. These strong men could be trusted to oppose communism and if they crushed legitimate democratic opposition, that was the cost of the Cold War. Fair enough, given the imperatives of the day.

It was true to say that before parliamentary democracy other legal rights were established in successful countries -property rights, the right to a trial by jury or peers, independent courts, professional merit-based public service.

Democracy is more than an election where the biggest tribe may win and then do what it likes. Democracy is about choosing leaders, about constitutional rule. The rule of law is about the parameters in which governments govern. All these arguments are still true because they are necessary pre-conditions for successful development, as is democracy.

Democracy has always had a hold on the people's imagination. That's why even the most vicious dictators feel obliged to call their countries the democratic people's republic of so and so. Many hold absurd elections still and claim 98 per cent support. Why bother? Because of their need to claim legitimacy. Legitimacy for governments comes only from the people, and the people can only give that if there is a choice.

The many experts who think authoritarian governments can do better do not oppose democracy. Many say they are just realists and argue that mass mob rule can incite ethnic hatred. Democracies' electoral cycles and populist politicians put impossible pressures on resources to fund health and education needs, which can be counter-productive. They say build a middle class first. The most eloquent of this school is Fareed Zakaria who, in his bestseller The Future of Freedom suggests that countries need to lift per capita income levels to US$6000 (NZ$8600)and notes dramatically that once societies have achieved this income level, civil society and the middle class ensure that democracy works. No country that has ever reached this income level has ever rejected democracy and reverted. It becomes embedded and grows.

He suggests Western strategy should be to support "liberal autocracies". But for how long? And is it true that only strong men and liberal force are successful in stamping out extremists who can exploit ethnic and religious differences?

For the first time in history most people are living in a system of self-government. A splendid new study entitled The Democratic Advantage explains:

* 95 per cent of the worst economic performances of the past 40 years were under non-democratic governments.

* Virtually all refugee crises have been wrought by autocratic governments.

* 80 per cent of all interstate conflicts are instigated by autocracies which are more vulnerable to civil wars.

* There has never been a famine in a democracy with a free press.

Poor democracies and countries in transition to democracy have nearly always out-performed authoritarian countries.

Consider what's important. Life expectancy, literacy, infant mortality, agricultural productivity, clean water - democracies get results 20 per cent to 40 per cent higher than their authoritarian counterparts.

There's a popular misconception that democracies have greater debts and bigger deficits. This is not backed up by the evidence. They are less corrupt, more efficient - because their leaders and civil services are more accountable and an active civil society, trade unions and free media are the watch-dogs. This cleansing air of transparency and the adaptability of democratic forces makes for better results. There is such a thing as a democratic peace and democracies rarely go to war with each other. As the number of democracies has increased, the number of wars, indeed civil wars have dropped.

The more open the society and the more open the economy, the better the results.

* Former Prime Minister Mike Moore was also head of the World Trade Organisation.

Eye on China: A chemical leak highlights two facts

The news of the recent petrochemical disaster at China's Jilin city in Jilin province has raised interesting issues.

First, it confirms what environmentalists have long been predicting, that China is indeed ripe for environmental disasters.

What happened just 320km from the densely populated city of Harbin, was the stuff of disaster movies. Having your water supplies wiped out through chemical contamination from the region's largest factory is surely the stuff of nightmares.

Second, the accident reflects the problems of control in China. The bureaucratic rank of the general manager of the plant was higher than that of the city mayor's.

What does this mean? Well, the plant manager and the city mayor have the same boss, the central Government back in Beijing.

The city mayor can hardly enforce health, safety and regulatory standards on the plant's manager, not just because he's outranked but also because the company's operations in the city account for half the city's gross domestic product.

You are not going to mess with the entity that provides your constituents with jobs, schools and hospital care. At least, not in a sector like the northeast which is going through painful economic restructuring.

The city mayor would have to appeal to the next level up. That would be to the Jilin provincial governor, to call the plant to order.

But CNPC, the owner of the plant through its majority control of PetroChina, could also call on its senior officials for back-up.

That's because the company's bureaucratic structure reflects that of the city and provincial governments.

Ultimately, it would take Ma Kai himself, the top man at the National Development and Reform Commission, one of China's most powerful ministries, to ensure that CNPC respects the rules.

Only he could outrank the CNPC's chairman, who is so powerful that he has the same bureaucratic rank as Ma Kai's second in command.

In the meantime, the CNPC chairman could safely ignore any complaints issuing from the humble bureau-level reform commission unit responsible for energy in China.

That a situation should arise where a company is deliberately made more powerful than a city government is the product of China's preference for huge state-owned enterprises.

The theory behind these giants is that they need special privileges to compete against foreign entrants.

CNPC and its Hong-Kong listed unit, PetroChina, were created by giving them a monopoly of the sum total of the country's onshore oil assets, operating directly under the central Beijing Government.

In the process, they outrank not just provincial companies but even provincial governments.

A couple of days ago, China's No 2, Wen Jiabao, showed up at the scene of the disaster. This shows the Government is serious about rectifying the problem - but it also shows just how rigid and inflexible the system is.

The problem should have been fixed long ago by the officials on the ground in Jilin. It shouldn't take a visit by China's second most powerful leader.

The other crucial issue raised by the incident is the role of the press. Many Chinese officials blame the panic that hit the city on news reports.

Foreign and domestic journalists retort that there would have been no panic if the Government was open about the extent of the disaster in the first place.

Journalists argue that people panic in an environment where accurate information is hard to find. That's why the rumour of an imminent earthquake sent people streaming out of the city.

Chinese officials don't see it that way. Steeped in the tradition of a powerful, all-knowing state, their take on the situation is that keeping the population informed will only cause confusion and panic. What underpins this view is a low opinion of China's population by its rulers.

"They [the people] are stupid, superstitious and uncultured. We cannot trust them to make the correct decisions - we must guide them," one official put it to me in all sincerity.

To a Westerner, this sounds like a recipe for disaster - but wait: there is another motive for the cover-ups which Western observers don't always grasp: fear.

"The population is so huge and unstable that a mass panic could literally bring the country down. This is a serious concern," the official said.

It is the Chinese history of large and terminally violent mass uprisings which really underpins the country's attitude towards handling the "truth". Most foreign journalists come from relatively peaceful societies, but China was being torn apart by near-civil war just 30 years ago during the Cultural Revolution.

Fair enough. But when a government exists whose relationship to its people is marked by such contempt and terror, officials would do well to ponder what kind of society they have brought into being.

* The writer remains anonymous to protect his position in China.

Anthony Doesburg: Lamb chops good, stifled broadband bad

We're an innovative lot, as we not infrequently like to remind ourselves. Early in our history we discovered how freezing the meat we grew meant it could be shipped to far-off customers. So for a century or so, frozen lamb exports were a mainstay of the economy.

The internet promised a similar breakthrough. A network that stretched to all corners of the world would allow us to export new types of products - ones based on brain power, rather than farmers' sweat.

First, the Government and its Knowledge Wave talkfests tried to get us thinking about the new economy. Then, in the spirit of innovation that allowed the British to enjoy roast New Zealand lamb, the Telecommunications Users Association (Tuanz) attempted to spark ideas for applications that would use the high-speed internet whose arrival was imminent.

Tuanz's mission was to drag New Zealand into the top half of OECD countries for ICT use. It assumed that the obstacle to unlocking our broadband potential would not be an inability to get high-speed internet access, but a lack of applications.

In November 2002, it launched a National Broadband Applications Project, part of its lofty goal of giving all New Zealanders the benefit of broadband internet access. Tuanz assembled nearly 300 sector group leaders, Government officials and ICT company representatives in Nelson for 48 hours of brainstorming. Ten sector groups (tourism, education, media, etc) were sent off to different corners of the venue by association chief Ernie Newman to dream of applications for a network unconstrained by data caps or bandwidth.

They duly dreamed, and came back with dozens of ideas - some of which were almost certainly feasible. A brief sample: tourism would be enriched by personalised information projected on to a visitor's sunglasses as he or she peered at some attraction or other; as the adventure traveller bungy-jumped into the Kawarau Gorge, the experience would be relayed live to family and friends watching on a TV screen on the other side of the world; news organisations that produce a newspaper only once a day or broadcast a handful of bulletins would disappear as individuals adopted virtual journalists (in the form of electronic agents) to report to them on events they were interested in when and where they happened.

Oh what a glorious future.

But, three years on, in the future they remain. It's not that the technology isn't up to the job.

The virtual bungy-jump, for example, needs little more than a webcam and abundant internet bandwidth to send A. J. Hackett to new heights.

But there's the problem. Contrary to what Tuanz assumed three years ago, broadband internet access remains the exception, not the norm. New Zealand still sits near the bottom of the OECD's broadband rankings.

Ernie Newman thinks the country is fed up with waiting for affordable, fast internet access. He certainly is. And he sees what he thinks are hopeful signs that the Government's patience is also running out.

Patience with Telecom is what's in increasingly short supply. The telco will achieve a target agreed with the Commerce Commission of having 250,000 residential broadband connections by the end of the year. But it will almost certainly miss a second - but in competition terms, more important - target of providing 83,000 wholesale connections, consisting of the Telecom DSL service resold by other internet service providers.

Telecom variously blames free local calling, and rival TelstraClear's lukewarm attitude to reselling DSL, for our slow broadband uptake. TelstraClear and other ISPs respond that there's next to no profit for them in reselling DSL.

Newman is pinning his hopes of Government action on a statement by ICT Minister David Cunliffe last week, although a close look at his words show the minister left himself plenty of wriggle room. Addressing New Zealand's poor broadband uptake rate at a conference in Wellington, Cunliffe said the Government would do something about it next year.

In Newman's book, that has to mean measures to make Telecom start giving other ISPs a better deal. But Cunliffe was far from explicit.

He said he was looking again at the issue of local loop unbundling, which the Government was on the brink of imposing on Telecom 18 months ago. Instead, we got unbundled bitstream, the wholesale broadband market which is proving so unsatisfactory.

Could this be the Government's opportunity to do something innovative? Instead of bothering with a belated local loop unbundling decree, there's support among ISPs for the Government to force Telecom's wholesale and retail arms apart, with separate organisations running each. That, the theory goes, would mean fair competition. In its wake would come cheaper broadband, and an explosion in demand. Consumers would benefit. ISPs would benefit. Even Telecom would benefit.

Isn't that an idea at least as worthy as frozen lamb?

Jim Eagles: Be wary of lifestylers

Many of what pass for travel books these days are not really about travelling as such but about someone going to live in a foreign country and writing about their experiences.

Many of these books are not worth bothering about, basically involving an ignorant visitor getting a few cheap laughs at the way people in other countries do things differently.

Good grief, if they didn't do things differently there'd be no point going there.

Other books, while fine in themselves, are just rip-offs of a formula which may once have worked but is now decidedly stale.

If I have to read another book about some Pom going to live in a French village and raving on about the food I think I'll scream.

But some are actually good value for travel enthusiasts.

On the one hand, there are books like Penelope Green's When in Rome that could inspire you to go there yourself. It certainly offers lots of good ideas about how to discover the real Rome.

On the other hand, not many people are likely to go and live in a traditional Masai village, but Corinne Hofmann's The White Masai allows you to share the experience from the comfort of your armchair.

The White Masai
By Corinne Hofmann
Bliss Books $34.95

An attractive blond Swiss girl goes to the Kenyan coastal resort at Mombassa on a holiday with her boyfriend, sees a Masai warrior on the dock where their ferry is berthing, falls hopelessly in love in an instant and stays there to be with him.

They get married, move to his isolated village, and have a daughter.

Crazy, sure.

By the end of the book the cultural divide has indeed proved too great and she takes her daughter back to Switzerland (though a sequel apparently has the couple meeting up again). But what a great story.

Hofmann's tale of her four years living as a Masai is utterly fascinating, both as a personal account of a hopeless love affair and as a piece of acute observation of the workings of an alien - to her and her readers - society.

The cultural divide stretches in every direction.

Although Hofmann is besotted with her lanky warrior in his braided red hair and wearing masses of jewellery, she still expects a fairly Western sort of relationship - even taking a traditional white wedding dress to the marriage ceremony - and simply can't cope with the Masai way of doing things.

Lketinga, her Masai, is by the sound of it extremely fond of his white bride, but he lives in a world where the men look after the goats and cattle and the women produce children, don't get sick all the time from malaria and, well, stay at home and do everything else.

Barsaloi, his village, may be delighted to enjoy the benefits brought by an educated and relatively wealthy white woman, not least a vehicle and a local store, but the villagers aren't prepared to change their customary ways, which pretty much guarantees that both will come to grief.

You might imagine that Kenya would be pleased to acquire such a useful resident, but bureaucrats see her only as a potential source of bribes and do everything possible to handicap the relationship and her business ventures.

Surprisingly, the most understanding people in all this seem - at least from Hofmann's telling of it - to be her family in Switzerland, who respond to her extraordinary choice with love and support.

Nevertheless, the neighbours must have been agog at one of their own going off to live with a Masai. Certainly the rest of Europe has been, because the book has sold four million copies in the original German, and the English translation is also flying off the shelves.

That's hardly surprising. Whether you're an enthusiastic armchair traveller or a hardened globetrotter, this book offers a unique opportunity to view an ancient society, and one remarkably little changed by the bulldozing effects of globalisation.

When in Rome: Chasing la dolce vita
By Penelope Green
Hodder $39.99

This is a rather more achievable story on the same theme. Successful young Australian woman breaks up with her boyfriend, decides she doesn't really like her flash job in PR and decides it's time to fulfil her dream of living in Rome.

Despite the fact that she doesn't speak Italian, has no proper visa, knows no one in Italy apart from an uncle in San Gimignano, off she goes.

But she loves all of it - the difficulties with immigration bureaucrats, the marvellous food, the lowly waitressing jobs, the delightful people, the language problems and the all-pervading history, the feckless boyfriends and the romantic atmosphere.

Summing up after two years of living her Italian dream, she makes it clear that in many ways it is the problem half of the equation that stimulates her the most.

"I've never felt happier because I am so challenged. Each day brings a new reality to face and a new subject to wrap my head around linguistically and culturally ... I can't get enough of Rome."

That spirit - the spirit of vive la difference - is exactly the right one to take with you when you travel overseas. This amusing, thoughtful book is both a great insight life in Rome and a terrific inspiration to go there and see for yourself.

Land of a Thousand Eyes: The subtle pleasures of everyday life in Myanmar
By Peter Olszewski
Allen & Unwin $29.99

My wife and I reckon our visit to Myanmar (Burma) a few years ago is the most fascinating trip we've made. Australian gonzo journalist, Peter Olszewski, has had a rather more varied life than us - his CV includes leadership of the Australian Marijuana Party and editing Australian Playboy - but he obviously feels the same way.

He didn't just take a holiday in Myanmar, he spent a year there training young journalists.

Land of a Thousand Eyes - the title reflects that, as a rare foreigner, his every move was watched by astounded locals - is a marvellously entertaining but insightful look at the real Myanmar behind the propaganda of both the military regime and its opponents.

The atmosphere is summed up by one of Olszewski's marvellous anecdotes. Waiting for a flight he is taken aside and searched by a soldier, who confiscates his plastic lighter. A watching American woman asks if everything is okay.

" 'Yes, all he did was confiscate my lighter,' I reply, while putting a cigarette in my mouth and absentmindedly patting my pocket, looking for the lighter which had just been taken. The soldier appears by my side again, graciously lighting my cigarette with the confiscated lighter.

" 'How odd,' the woman comments. 'He takes your lighter and then he comes and lights your cigarette.'

" 'Welcome to Myanmar,' I say."

A book for armchair travellers, but which might inspire you to ignore demands for a travel boycott and see for yourself.

On Rue Tatin
Tarte Tatin
By Susan Loomis
Harper Perennial $24.99 each

Two books about an English woman who goes to live in a charming village in Normandy and learns about traditional French cuisine. Aaaaaarrrrrrgggggghhhhhh! To be fair, these are two of the better books of this genre, it's just that there are too many of them.

Tim Gibson: Breaking down the barriers

Holes in some of the myths about business attitudes towards China have been exposed by a survey of exporter confidence.

Our businesses are much more positive towards the country many portray as the bull in our shop than you may have been led to believe. But at the same time we can't ignore the fact that China does raise tough issues for a number of our domestic and export-focused businesses and these need to be dealt with.

The DHL Export Barometer, which surveyed 300 long-standing exporters during September, showed that support for a free trade agreement (FTA) with China is right up there with the US. Asked how an FTA with China would affect their businesses, 52 per cent of respondents were positive compared with 57 per cent for the US.

And among manufacturers - who already face real challenges from China - there was strong support for the agreement with 72 per cent saying it would have a positive impact on their business.

When asked how they felt various markets would perform over the next year, 58 per cent said they expected export orders from China to increase - first-equal with Australia.

The positive attitudes towards China shown in the September barometer are backed by a more detailed examination of business attitudes regarding China held during March and April of this year.

Of the companies currently exporting to China surveyed in this earlier barometer, only 15 per cent would advise other companies against entering the Chinese market.

One in three said they faced no barriers when entering the China market. The biggest obstacles were strength of competition (19 per cent), different business practices (17 per cent), the regulatory environment (12 per cent), language (10 per cent), and setup costs (3 per cent).

There was an interesting split in attitudes regarding the China FTA among companies who were exporting to China and those who weren't. Eighty-two per cent of those already in China believed the FTA would have a positive impact against 53 per cent of those who weren't.

To some extent this is not surprising, but it may also indicate a fear of the unknown. New Zealand Trade and Enterprise (NZTE) found a similar situation in attitudes towards exporting to the Gulf states where the "physical and psychological distance" meant companies looking from the outside saw greater barriers than those who were actually there.

The myths about trading with China have some basis in reality.

Our fourth-largest export market (worth $1.52 billion in the year to the end of September) is a perplexing mix of opportunities and challenges.

There are large gains to be had for the New Zealand economy. A joint study by New Zealand and China estimates that from 2007 to 2027 our exports to China will be between 20 and 39 per cent higher if an FTA is in place than they would be otherwise.

However, for our exporters it's a tough market to break into and be successful in. China has its own particular challenges around language, culture and business practices.

And at home the might of the Chinese economy, which is large enough to shake up the superpowers, is already changing the way we do business. To survive, New Zealand businesses have had to move up the value chain away from low-value goods and services, adopt new business models such as clusters, increase productivity and form international business partnerships.

The DHL Export Barometer, which was developed in consultation with NZTE also reveals that our businesses are polarised over China like no other country. For example, 18 per cent of respondents say the FTA will have a negative impact on their business compared with just 5 and 7 per cent for the US and Japan respectively.

China, in line with other Asian markets, is not seen as particularly lucrative. Forty-eight per cent of respondents named Australia as their most profitable market compared with just 18 per cent for China.

Some of this can be explained by geography and history. Australia is a close neighbour and a mature market whereas China is half a world away and a relatively young market in which our exporters are often still incurring set-up costs.

The belief that the China FTA will not be good for business is much stronger among manufacturers than other sectors. Twenty-eight per cent of manufacturers feel the FTA will have a negative impact compared with 5 per cent in tourism and 16 per cent in agriculture, food and beverages.

Though these concerns must be addressed, the barometer shows that most New Zealand businesses are looking towards China with a positive frame of mind.

* Tim Gibson is chief executive, New Zealand Trade and Enterprise.