Prime Minister John Key assures kiwifuit export halt because of fruit fungus not revenge

The Government is concerned that Zespri is having problems with its exports, especially because China is Zespri's largest market. Photo / File

Prime Minister John Key is insisting that there is no link between the kiwifruit industry's export problems in China and allegations that Beijing is carrying out a "trade war" with New Zealand.

New Zealand's kiwifruit exports to China are temporarily on hold after the country's border authorities found a fungus on the fruit and issued a warning notice.

That came after claims that China could retaliate against New Zealand's dairy and horticulture exporters in response to a potential investigation into alleged Chinese steel dumping in New Zealand.

"I understand the backdrop of the issue but people should be careful about joining dots," Key told reporters at his weekly press conference this afternoon.

Key was asked why China had taken action against Zespri exports at this time, given the fungus had been detected in New Zealand kiwifruit for decades.

"I can't answer that question, I simply don't know," Key said.

The Prime Minister described the Zespri matter as a "technical issue" and an "individual trade issue" which was inevitable in a broad trading relationship.

Trade Minister Todd McClay raised it with his Chinese counterpart Gao Hucheng during trade talks in Laos last week.

"Where there have been claims made about reprisals in relation to our trading relationship with China, we have sought assurances that wouldn't be the case," Key said.

"I think we're comfortable that these individuals trade issues are literally that - individual trade issues, not part of a wider programme of retaliation against New Zealand."

Earlier today, Key said kiwifruit exports to China were expected to resume "quickly', though he did not have a precise date.

New Zealand First leader Winston Peters said New Zealand was now too dependent on China, and the Chinese Government was "telling us what to do".

Peters said the Government should be demanding that China followed international trade rules.

"It's time the government told China you are not our master, we will not be bullied around."

How it unfolded

Late May: Trade Minister Todd McClay first told about claims that China could retaliate against NZ exporters in response to a possible investigation into alleged Chinese steel dumping in NZ.
July 8: McClay briefed about conversation between a Zespri manager and a Chinese trade association, in which the NZ company was told about potential reprisals.
July 17: Fairfax reports that Beijing is considering a "Trade War" with NZ in response to the potential investigation into Chinese steel.
July 18: McClay asked about the issue by media in Indonesia. He says he was briefed about it the previous week.
July 25: McClay reveals he has known about the issue for several months. He apologises to Key, saying that he mislead him. Labour leader Andrew Little unsuccessfully calls for his resignation.
July 29: China issues a warning notice to Zespri about the fungus on its fruit.
August 3: McClay meets with Chinese Trade Minister Gao Hucheng in Laos to seek assurances that the Zespri case is not linked to any alleged reprisals.
August 5: Zespri says it is temporarily deferring kiwifruit exports to China.