New Zealand and China are set to start negotiating an upgrade to the free trade agreement between the two countries, and Prime Minister Bill English isn't expecting an easy ride.
Mr English and Chinese Premier Li Keqiang announced on Monday, after talks in Wellington, that negotiations would begin on April 25.
"There are going to be challenging negotiations to get what New Zealand wants, but that's nothing new," Mr English said.
"We're used to always negotiating trade agreements around sensitive issues - particularly around agricultural products."
Mr English said New Zealand was going to want improved access for New Zealand products.
Premier Li said the upgrade would be the first such negotiations China had held with a developed country.
"It will give a strong boost to trade links, and show the world we are committed to free trade," he said through an interpreter.
"Compared with China's agreements with other countries, this agreement with New Zealand is the most advanced."
Trade was the central issue in their formal talks at Premier House, but their discussion ranged across bilateral and international issues.
Premier Li described the talks as "frank and candid" while Mr English said they had been "very productive."
"We are working together... we can avoid frictions," the premier said.
Premier Li is the second most important Chinese leader after President Xi Pinjing, and Monday's meeting was seen as significant to the relationship between the two countries.
In addition to the agreement to start FTA negotiations, the two countries signed initiatives ranging from access for chilled meat, a climate change action plan and stronger cooperation on judicial and law enforcement issues.
