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"We’ll do what’s right for the Pacific," he added in a lively, wide-ranging opening address to the University of Otago’s 53rd annual Foreign Policy School in Dunedin yesterday.
"It’s the quality of our foreign policy which is critical, and the quality of our ideas and our reputation.
"It’s a reputation which we need to protect."
He was addressing about 160 delegates at the three-day school, which this year focuses on "Asia-Pacific Diplomacy in Transition: Ideas, Issues and Institutions".
Mr Peters, who is also Acting Prime Minister, spoke out strongly in favour of a pragmatic and inclusive Asia-Pacific foreign policy, based on genuine partnerships, active listening to identify real needs, and a willingness to do what was right.
New Zealand was also celebrating the origins of its Ministry of Foreign Affairs and Trade, 75 years ago.
"New Zealand diplomats have done a tremendous job, but they’ve been massively under-resourced," he said.
The recent Budget had earmarked $714 million for increased foreign aid spending, largely targeting the Pacific, and further money was being spent to hire 50 more diplomats.
The extra spending was needed if New Zealand was to stand up adequately for its perspectives and values.
The funding was also needed if our diplomats were to maintain their credibility in dealings with other countries and potential international partners, without "looking over your shoulder at what’s behind you".
New Zealand could hardly seek support from others if it was not prepared to back itself by providing sufficient resources to promote its views.
New Zealand had to be prepared to "pay our way" in a more complex and challenging world, in which great power rivalries were re-emerging.
As a small country, New Zealand was strongly committed to rules-based multilateral approaches, upholding the Law of the Sea, including the freedom of navigation and overflight in international waters, and "protecting our interests", he said.