NZ to spend $30m on Expo pavilion

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New Zealand will spend $30 million constructing and promoting its pavilion for the 2010 World Expo in Shanghai, Prime Minister John Key said today.

The sum is five times the amount spent at the last world expo at Aichi in Japan and Mr Key said he was planning to return to China next year with a business delegation to promote New Zealand and its business links.

The Chinese are estimating 70 million people will visit the expo and Mr Key said if only a small number of those chose to buy New Zealand goods or visit the country, then the economic spin-offs would be enormous.

Speaking at the opening of a business centre for New Zealanders working in Shanghai, Mr Key said New Zealand had to invest heavily to increase trade into China.

The time for debating the merits and potential of doing business with China was over.

"The question is how you convert that into a long term successful business model and that has eluded a lot of businesses in the past and it is not to be underestimated the challenges that are here, but that is why New Zealand has to invest heavily," Mr Key said.

Government agencies were there to help and would continue to do so, he said.

Both Zespri and Solid Energy said they would be spending money on developing New Zealand's exhibition to help draw the attention of the millions of visitors expected to visit the expo.

New Zealand's exports to China have been booming since the two countries signed a trade deal a year ago despite the global economic recession.

China has reported its worst economic growth data since 1992. It slowed in the first quarter of 2009 to 6.1 percent, but some analysts see signs of a recovery with hope that the last quarter was the trough.

Growth was 6.8 percent in the last quarter of 2008, but the first quarter GDP figure dropped as exports fell 17 percent in March.

China's government has said it is determined to achieve annual growth of 8 percent, and to expand its domestic demand.

Mr Key said while the Chinese export sector was being hit hard, internal demand remained strong.

New Zealand had to work hard to build on the trade deal.

"I strongly believe the potential upside is enormous for both countries, the FTA provided us with an entree into the Chinese market and the challenge for New Zealand is to convert that into real success for our economy.".

Mr Key continues his trip in Shanghai today, before flying out to the Boao Forum on Hainan Island over the weekend.

The forum is a regional economic summit bringing political and business leaders together.

Mr Key believed his trip to China had been a tremendous success, with Chinese leaders saying relations between the two countries had never been better.

(Ian Llewellyn travelled to China with the assistance of the Asia New Zealand Foundation)

- NZPA