Key to Korea: Move fast on a free trade deal

South Korean President Lee Myung-bak shakes hands with New Zealand Prime Minister John Key during their meeting at the Presidential house on March 25 in Seoul. Photo / Getty Images.

Prime Minister John Key has warned Korean businesses that if Korea does not move fast on a free trade agreement it risks having Korean goods displaced by those of other countries on New Zealand's shelves.

Mr Key issued a strong message at a Kiwi Chamber breakfast in Seoul today, speaking to Korean business people with interests in New Zealand.

He emphasised the benefits to Korea of the deal, including food security.

Key is trying to reignite trade talks while in Seoul. He later said that speed was critical - major companies like Fonterra and Zespri were only just managing to hold on in Korea and would not last much longer because of steep tariffs which did not apply to their international competitors.

The same could happen to Korean businesses in New Zealand such as Samsung, Hyundai and LG.

"Imports from countries that New Zealand already has FTAs with are growing much faster than imports from Korea."

He said the main obstacle for Korea was the farmer lobby - although New Zealand did not grow rice and only a small amount of grain-fed beef which were the two main areas of concern.

He said trade with China in New Zealand was growing, but New Zealand needed a diverse range of markets.

"China has exponential demands so one of the risks for other companies is that New Zealand increases its exports to China to the exclusion other countries."

He said that might be good for New Zealand in the short term, but it would be worrying if New Zealand narrowed down to one major market.

Mr Key had an informal drink with Australia's Prime Minister Julia Gillard last night. He said the pair discussed the free trade talks, climate change and the Queensland elections and "had a gossip" over a New Zealand pinot noir.