By Stephen Wright

WELLINGTON, New Zealand--China's repression of Uyghurs is dividing U.S. allies over whether to characterize human-rights abuses against the mainly Muslim minority as genocide.

New Zealand's government blocked on Wednesday a parliamentary motion that would have labeled China's actions genocide, illustrating the precarious balancing act facing the South Pacific country between its longstanding ties and security alliance with the U.S. and its trade ties to China. Australia has also shown a reluctance to use the term.

U.S. officials have been pushing for collective action to counter Beijing as it applies more coercive measures at home and abroad. The U.S. said earlier this year that China was carrying out a genocide against Muslims in its western Xinjiang region, where evidence has emerged since 2018 of an expansive system of forced re-education and labor camps. The U.K.'s Parliament has also voted to declare China's actions against Uyghurs genocide.

China denies that any abuses are taking place in Xinjiang and says that reports of mass incarceration of Uyghurs are lies. Its embassy in New Zealand's capital, Wellington, didn't answer calls or respond to an emailed question. In response to previous New Zealand government statements about Xinjiang, the embassy has said New Zealand should stop interfering in China's domestic affairs.

As small economies, New Zealand and Australia are far more exposed to trade retaliation by China, the largest buyer of their exports, than the U.S. or U.K. Over the past year, China has imposed a series of import restrictions and tariffs on Australian products including barley and beef, after being angered by Australian Prime Minister Scott Morrison's call for an international investigation into the first outbreak of Covid-19 in China.

New Zealand's Parliament debated and endorsed a motion that expressed grave concern about "severe human rights abuses" against Uyghurs and other ethnic and religious minorities in Xinjiang. The minority ACT party, which pushed for the debate, said Prime Minister Jacinda Ardern's ruling Labour Party had objected to describing China's actions as "genocide," which resulted in the watered-down wording..

More than half of lawmakers, including Ms. Ardern, weren't present for the vote on the motion.

"It's a sad state of affairs that we need to soften our language to debate the hard issues," said Brooke van Velden, ACT's foreign-affairs spokesperson.

A spokesperson for Ms. Ardern referred questions to Foreign Minister Nanaia Mahuta, who told Parliament on Wednesday that the government wouldn't make a formal designation of genocide until there had been a "rigorous assessment on the basis of international law."

The U.N.'s genocide convention defines the term as acts committed with the intent to destroy in whole or part a national, ethnic, racial or religious group--including killings, forced birth control, removal of children, and serious bodily or mental harm.

Australian officials have also been hesitant to call China's repression in Xinjiang genocide. "We have a slightly different approach to that turn of phrase" compared with allies including the U.S. and U.K., Foreign Minister Marise Payne said in March.

Both countries have a lot to lose by angering China. Australian exporters of barley and wine have been targeted by higher Chinese tariffs, and coal traders have also faced restrictions, although the dispute hasn't affected iron ore, which China needs to make steel.

New Zealand was the first developed nation to sign a free-trade agreement with China, in 2008, and trade has more than quadrupled since then. China is now New Zealand's largest export market, taking some 30% of shipments and as much as the next three largest markets--Australia, the U.S. and Japan--combined.

New Zealand has a smaller and narrower economy than Australia, and export industries such as dairy and logs have become particularly reliant on Chinese demand.

Tim Groser, a former New Zealand ambassador to the U.S., said the human-rights abuses in Xinjiang are serious but don't rise to the level of genocide. And foreign policy shouldn't be based on one issue, he said.

Ms. Ardern told a China business summit in Auckland this week that the differences in values between China and democracies such as New Zealand were becoming harder to reconcile as China's role in the world economy grows.

New Zealand, however, has resisted what it sees as a possible broadening of the "Five Eyes" intelligence gathering and sharing arrangement with the U.S., U.K., Canada and Australia into a diplomatic grouping that confronts China.

On occasion, New Zealand hasn't signed on to joint statements on China by the Five Eyes nations. Instead it has made its own statements, or joint statements with neighboring Australia, about Hong Kong's loss of autonomy from China and what it calls credible reports of severe human rights abuses against Uyghur Muslims.

Prof. Anne-Marie Brady, a Chinese politics specialist at the University of Canterbury in New Zealand, said Ms. Ardern's comments showed that the government has become more direct about its China concerns even as it is taking pains to maintain an independent foreign policy.

Write to Stephen Wright at stephen.wright@wsj.com

(END) Dow Jones Newswires

05-05-21 0558ET