Prime Minister John Key says Russia has tried to reignite free trade talks - but New Zealand has made it clear it will not budge until Russia buckles to international demands over Ukraine.
And Key said Putin sending warships in an apparent show of muscle-flexing during the weekend's G20 summit was unhelpful when Russia was facing increasing international pressure over the Ukraine and suspicions it was involved in the shooting down of the Malaysia Airlines flight.
However, Key could also face questions about why New Zealand is not taking a firmer stance on Russia.
Key said halting the free trade talks had sent a message. The Government had pulled Trade Minister Tim Groser out of the talks in March because of the Ukraine. "We were within millimetres of signing a free trade agreement with Russia and we stopped that. The Russians have been wanting to progress that and New Zealand has been saying 'no, we're not going to progress that until we see a change in what has been happening and the approach of the international community'."
Asked if that was damaging our reputation at the G20, where many countries had imposed the sanctions, he said New Zealand law did not allow it to impose specific trade sanctions, so it was limited to travel sanctions. However, New Zealand companies had been urged not to trade with Russia. "There would be great opportunities for our companies, in particular dairy companies like Fonterra to exploit that and they're not doing that."