New Zealand seeking to build strong, multi-faceted relationship with China

New Zealand Prime Minister John Key said he hopes to build an increasingly strong and multi- faceted relationship with China when he leads one of the country's largest-ever prime ministerial delegation to China.

In an exclusive interview with Xinhua ahead of his China visit starts on April 6, Key said New Zealand treasures its relationship with China because it's a "very important and a very significant one."

"We have a big trading relationship with China and now they're our largest source of foreign students; they're our second largest source of tourists; they're our second largest market overall," said Key at Parliament Building in Wellington.

"We're seeing a big change in our trading patterns. There's also a growing investment in both our markets happening, with China increasingly investing in New Zealand and New Zealand companies investing in China. So from a trade and economic perspective there's a lot happening in the relationship."

The two countries were also working together in the field of development and aid, as seen in the joint project to build a water reticulation plant in the Cook Islands, as well as exchanging ideas and views in areas including climate change and science, according to the prime minister.

"So at so many different levels we have a multi-faceted relationship with China and it's one that continues to grow in importance and strength," Key added.

Key's visit will celebrate the 40th anniversary of bilateral diplomatic ties and the fifth anniversary of the China-New Zealand Free Trade Agreement (FTA), and it will also be an opportunity for him to meet Chinese President Xi Jinping and Premier Li Keqiang in their new capacities in China's new leadership.

TRADE TARGET ON TRACK

New Zealand was "very pleased" to be the only developed economy to have an FTA with China, as it gives the country an advantage in the Chinese market, Key said.

New Zealand exports to China have more than tripled since the signing of the FTA to 6.9 billion NZ dollars (5.8 billion U.S. dollars) last year, up 16.6 percent on the previous year.

Bilateral trade was set to hit the target of 20 billion NZ dollars by 2015.

In talks in Beijing in 2010, Key and then Chinese Premier Wen Jiabao agreed to double the bilateral trade from that year's level of 10 billion NZ dollars within five years.

"I think the target's on track. We're at just under 15 billion and it's 2013, so the aim is to get to 20 billion by 2015," Key said.

"The exchange rate's been moving up and this can affect those numbers a little bit as well, and you've had the global financial crisis and the slowdown of Europe, so if you take all those factors into account, you've got to say it's been very, very stellar growth between the two countries."

Key added the two countries would exceed the target over time.

"I think in many areas there's huge potential and that's one of the reasons we're taking arguably the biggest business delegation I have in terms of an overseas trip. That's a sign of the interest from New Zealand businesses to be involved in this trip to China."

INVESTMENT WELCOME

New Zealand also had "a clear message for China: your investment is welcome," Key said.

His comments came just months after two Chinese purchases -- the sale of the 16 Crafar dairy farms to Shanghai Pengxin group and white goods giant Haier's takeover of New Zealand's iconic Fisher & Paykel Appliances -- stirred controversy over the foreign ownership of New Zealand assets.

"The message is pretty clear: we welcome your investment in New Zealand. We need foreign investment to grow. We think those kinds of investments and partnerships can make a big difference in opening up markets like China for New Zealand," Key said.

He cited Shanghai-based Bright Dairy's 2010 purchase of a 51- percent stake in the Synlait Milk dairy processing firm as a positive example of Chinese investment.

"If you take Bright and their investment in Synlait, what you' ve seen is them not only stabilizing a company that was otherwise in a little bit of trouble, but also opening up the infant baby formula market to that company, and that's been very good in terms of growth opportunities and ...it's created jobs," he said.

The overwhelming number of New Zealanders generally supported foreign investment and the government tried to be very transparent regarding foreign investment.

"We are totally color blind. In the end we apply the same rules whether it's a Chinese investor or a British investor," said Key.