China and New Zealand yesterday agreed to step up progress on free trade negotiations during Premier Wen Jiabao's visit to the island nation.

The two countries also signed a series of pacts to increase co-operation in such areas as legal assistance and cultural exchanges as well as education and training.

During their talks in Wellington, Wen and his New Zealand counterpart Helen Clark agreed to raise the negotiations on a free trade agreement (FTA) to the vice-minister level.

There have been six rounds of talks on the FTA since November 2004 and the next round is set for next month.

The talks have entered a crucial stage and have encountered some difficulties, for instance, in agriculture and services, Wen said at a joint media conference with Clark.

"These are not insurmountable difficulties they might be a blessing in disguise."

Wen hoped the talks could be completed within one or two years.

"The agreement will be comprehensive, of high quality, balanced, and serving the interests of both sides and acceptable to both sides."

The planned FTA would be China's first with a developed economy, Wen noted.

He arrived in Wellington late on Wednesday for an official visit to New Zealand, the first trip to the country by a Chinese premier in nearly 18 years.

It is the third leg of his four-nation Asia-Pacific tour, which earlier took him to Australia and Fiji. He is due to arrive in Cambodia late today.

China is New Zealand's fourth-largest trading partner with bilateral trade reaching US$2.68 billion last year, almost 2.5 times that in 2000.

Educational exchanges are frequent and New Zealand is host to nearly 30,000 Chinese students. Besides, 85,000 Chinese tourists visited New Zealand last year.

Speaking at a luncheon in honour of her Chinese guest, Clark said: "We are engaged in free trade negotiations which offer opportunities for the development of both our economies."

Both sides also agreed to strengthen co-operation in fighting organized cross-border crime.

Clark announced that New Zealand would participate in the 2010 World Expo in Shanghai.

One of the agreements yesterday was for Air New Zealand to operate a direct flight between Auckland and Shanghai.

"We also look forward to closer collaboration in Asia Pacific Economic Co-operation and at the East Asian Summit, as well as in the many other international organizations of which we are both members," Clark said. "New Zealand can be both a contributor to, and a beneficiary of, China's growth and development."

(China Daily 04/07/2006 page1)

(For more biz stories, please visit Industry Updates)