KEY POINTS:
The United States' thaw in relations with New Zealand moved significantly yesterday with the announcement that a large contingent of Kiwi troops will exercise with US troops in Europe next month.
A total of 172 New Zealand troops will join US, British, Australian and Canadian troops in an exercise code-named Exercise Co-operative Spirit, in Hohenfels, Germany, involving peace-keeping and combat exercises.
Defence Minister Phil Goff last night described it as "the exercise of common sense over perhaps a more ideological position earlier on that because we disagreed on the nuclear issue, then we couldn't do anything together".
But he also said next month's exercise was part of the "continuum" of evolving change in the relationship.
That has been very apparent in the second term of the George W. Bush Administration.
US Secretary of State Condoleezza Rice foreshadowed a greater thaw in Auckland recently when asked if the US should lift its ban on defence forces exercising together.
"The relationship is not stuck in the past and there have been a lot of changes in the world since that time," she said.
"And if there are remaining issues to be addressed then I think we have got to find a way to address them because the relationship between New Zealand and the United States is such a beneficial one and such a fruitful one for co-operation along a wide range of issues."
The US default position has been a ban on joint exercises with New Zealand as part of the presidential direction of reprisals against New Zealand's 1987 legislation banning nuclear-powered or -armed warships.
Exceptions have been made for exercises such as those under the proliferation security initiative; or secret training of the SAS before a deployment to Afghanistan; or the recent deployment of eight naval personnel on a US naval humanitarian mission to Papua New Guinea.
While the defence relationship is nowhere near business-as-usual, there has been nothing since the rift on the scale of the exercise in Germany involving regular troops.
Mr Goff said New Zealand had served alongside the United States in Bosnia for many years and in Afghanistan.
"And if you serve alongside another country it does makes sense to try to promote inter-operability, to understand the methods and way of operation of other countries that serve alongside."
Green foreign affairs spokesman Keith Locke said he was concerned New Zealand could "slip back into a more traditional alliance relationship" with Britain, Australia and the United States. He did not want New Zealand getting involved in the "counter-productive war" in Afghanistan that had strengthened the Taleban.
