John Key

By Kate Chapman of NZPA

Seoul, Korea July 6 NZPA - Prime Minister John Key is hoping to build on the success of his time in South Korea when he travels to China tomorrow.

Mr Key has been in South Korea since Sunday. He leaves tomorrow morning for Beijing. From there he will spend three days in Shanghai before visiting Vietnam.

The main focus of his South Korean trip was progressing a free trade agreement (FTA).

He said the trip had been a success and an FTA was "within touching distance".

"I was concerned when I came up here because negotiations for all intent and purposes had stalled."

There were fresh legs on the negotiations now, Mr Key said.

During his time in Seoul Mr Key has tried to dispel fears about the impact of New Zealand's agriculture sector on domestic producers in South Korea.

He has said New Zealand exports to South Korea would compete with exports from the European Union, Australia and the United States, not domestic commodities.

An FTA that did not include agriculture and horticulture would not be acceptable to New Zealand, Mr Key said.

He also commemorated the 60th anniversary of the Korean War in which 45 New Zealand servicemen were killed.

Free trade will also be back on the agenda in China.

Two years on from New Zealand signing an FTA with China that country has gone from being our fourth to second largest market.

"The potential is still a long way away from where we are at the moment, there's just enormous potential in China," Mr Key said.

He would talk to Premier Wen Jiabao about how to grow the relationship even further and expand on the $10 billion two-way trade between the countries.

That was possible because of demands from the fast growing Chinese economy which was likely to grow between eight and 10 percent this year, he said.

Mr Key will also visit the New Zealand pavilion at the World Expo in Shanghai.

More than seven million people were expected to visit the pavilion over six months.

The Government invested $30 million in the site.

It was important to capitalise on that on New Zealand's national day at the expo this Friday, Mr Key said.

Mr Key will return to New Zealand next Tuesday.

(Kate Chapman travelled to South Korea with the help of funding from the Asia New Zealand Foundation)