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New Zealand wants to upgrade Japan, South Korea trade links in wake of China deal

AP - Monday, May 12

WELLINGTON, New Zealand - New Zealand Prime Minister Helen Clark will visit Japan and South Korea this week seeking to upgrade trade relations with both Asian countries in the wake of signing a free trade agreement with China.

With China "showing its openness to comprehensive free trade agreements it does become more important in our view for Korea and Japan to be thinking along those lines," Clark told reporters Monday.

Japan is New Zealand's third largest export market. Trade between the two is worth NZ$7.3 billion (US$5.7 billion; €3.7 billion) a year, but both sides agree the relationship has lagged in recent years.

In her first stop in Tokyo, Clark will meet Japan's Prime Minister Yasuo Fukuda and other senior members of the Japanese Cabinet on Wednesday.

Ian Kennedy, New Zealand's ambassador in Tokyo, said that while the prospects of Japan and New Zealand moving toward a bilateral trade deal remain "tough" because of the "high profile of agriculture products in our trade with Japan," the issue is too important to ignore.

Japan's farm sector is wary of New Zealand's big dairy sector, but New Zealand "hand on heart is not in the business of driving down dairy prices." Instead, it is looking to partner with Japanese dairy manufacturers, he said.

Clark goes to Seoul on Friday to meet with President Lee Myung-bak and senior Cabinet ministers.

New Zealand Ambassador Jane Coombs said South Korea's new government has given signals that it wants to increase its global and regional presence and that New Zealand is "in its sphere of diplomatic interest."

In turn, New Zealand is keen to "show the new government the value of entering a closer economic relationship" through a bilateral free trade agreement first mooted by South Korea in 1999, she said.

Two-way trade between New Zealand and South Korea is worth over NZ$2.4 billion (US$1.9 billion; €1.2 billion) a year. South Korea is New Zealand's sixth biggest export market.

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