New Zealand PM wants defence shakeup, focus on 'traditional' allies

New Zealand will shakeup its defence forces and "reset" its foreign policy to align with traditional allies, the country's prime minister said Thursday.

In his first major foreign policy speech since taking office last year, premier Christopher Luxon said the country could no longer depend on the "splendid isolation" provided by its geography.

"The foundation of our foreign policy reset is our collaboration with longstanding partners," Luxon told the Lowy Institute, a foreign policy think tank in Sydney, Australia.

He said the country would look to strengthen links with traditional partners -- a notable shift after years of closer economic ties with China -- citing the United States, Britain, NATO, and Pacific neighbours as those "we know best and with whom we have deep reservoirs of trust".

Luxon acknowledged that China remains New Zealand's biggest trading partner and "a country of undoubted influence", but said different values mean "there are issues on which we cannot and will not agree".

In March, Wellington said a Chinese "state-sponsored group" was behind a 2021 malicious cyber attack that infiltrated sensitive government computer systems.

China dismissed allegations of hacking and accused critical New Zealanders of being puppets of Washington.

Sketching "tectonic shifts" in regional geopolitics, Luxon warned that New Zealand must be clear-eyed about the risk of regional conflict.

"We can't achieve prosperity without security," he said.

"New Zealand too must be a participant and a contributor -- not an interested bystander."

To that end, a defence review is expected to focus on replacing and upgrading the country's military capabilities.

New Zealand is also mulling participation in AUKUS efforts to develop advanced military technology such as artificial intelligence, undersea drones, and hypersonic missiles.

AUKUS currently groups Australia, the United Kingdom and the United States.

High-profile New Zealanders such as former prime minister Helen Clark have warned against irking China and an increasing dependence on the United States.