The Government is building a new embassy in Beijing to house a major boost to New Zealand's representation in the Chinese capital.

Foreign Affairs Minister Murray McCully has confirmed to the Business Herald that Ambassador Carl Worker and his team will shift to an embassy vacated by another mission while a new one is built.

McCully did not disclose the cost of the new embassy. He said all options - including shifting to a site outside the prime Chaoyang diplomatic district - were considered. "It was not a frivolous decision."

At the launching of the "Opening Doors to China" strategy at The Cloud in Auckland yesterday, Prime Minister John Key stressed New Zealand was on track to double two-way trade to $20 billion by 2015 - a goal he set with Chinese Premier Wen Jiabao in Beijing in 2012.


Despite the controversy over Shanghai Pengxin's $210 million investment in the Crafar dairy farms, Key did not shy away from welcoming more Chinese investment.

But he was less fulsome than Ethnic Affairs Minister Judith Collins who this week told an ANZ lunch to celebrate Chinese New Year that "having discussed this with the Prime Minister yesterday, we will not be stopping people from being able to buy lands just because they are Chinese".

McCully also unveiled plans to launch a New Zealand China Council in time for the first "partnership forum" between the two nations. This is expected to take place in Beijing later this year, about the time Key makes a formal visit to China to commemorate the 40th anniversary of diplomatic relations.

Council members will be drawn from business, the public service, academics and the sporting and cultural worlds. A bilateral dialogue involving the Treasury and Reserve Bank is also planned to build a stronger understanding of each country's finance and economic policy positions - something of considerable importance given China's stated intention to invest in New Zealand government bonds and infrastructure - particularly the rebuilding of earthquake-hit Christchurch.

McCully also indicated a strong emphasis on helping China crack the rugby sevens market.

The China strategy has sat in the Government's top drawer since April.

At yesterday's launch, entrepreneur Richard Yan, head of Richina Pacific, announced plans to build a centre in downtown Shanghai where New Zealand firms could display their wares. He said Chinese desire to invest in this country was strong.

And in a barely disguised serve at dairy giant Fonterra, he made it clear that the real opportunity was to put high-value branded products into the Chinese market instead of selling commodities.


ANZ NZ Institutional managing director David Green praised the strategy as a good centralised plan to strengthen the relationship.

But he said a "major mindset change" among many Kiwis towards China was needed if New Zealand was to genuinely take advantage of the great political relationship the two countries have.

China push
Government's 2015 China goals:
* Build strong and resilient political relationship.
* Double two-way goods trade to $20 billion.
* Grow services trade (education by 20 per cent, tourism by at least 60 per cent).
* Increase bilateral investment to levels that reflect the growing commercial relationship.
* Foster high-quality science and technology collaborations.