John Key talks Isis threat with Barack Obama

John Key shakes hands with Chinese President Xi Jinping during a welcome ceremony at Apec. Photo / AP

Prime Minister John Key was the lunch companion of Chinese president Xi Jinping yesterday and the dinner companion of US president Barack Obama for two hours the previous night, Mr Key said after the Apec summit in Beijing last night.

He talked to Mr Obama about the Isis threat in the Middle East.

He said Mr Obama had clearly been briefed about his major national security speech last week in which Mr Key said New Zealand was scoping out a training role in Iraq but no combat role.

Mr Obama had agreed that diplomacy was the ultimate answer.

"I talked him through [the options] - ultimately if we were engaged in training whether he thought that would be beneficial in the context that Americans had trained people for a long period of time.

"He is very much in agreement with me that ultimately the real issue here is one of diplomacy."

He said Mr Obama was quite confident about the capacity of new Iraqi Prime Minister Haider al-Abadi to reach out to Sunnis and be much more inclusive.

"I think him and I are very much on the same page - that you need some military capability and clearly need to try and control and rein in Isis but on the other side of the coin if you are really looking for a long term solution, it has got to come from people feeling as though they are part of the long-term solution to Iraq."

Mr Key said he had spoken at the Apec leaders retreat a couple of times.

He talked about the threat of Isis in the Middle East not just to innocent people but to economic stability.

He also talked about how he believed the TPP 12-country trade talk was not in competition with the broader concept of the Apec-wide Free Trade Area of the Asia Pacific (FTAAP).

It's an old concept that has been revived by China and the Apec leaders have decided to start looking at it over the next two years, without actually launching it.

Mr Key also talked to Mr Obama about visiting New Zealand and reckoned there would be "a better than reasonable chance" he would visit before his presidency ends in just over two years.

Mr Key did not have a formal bilateral meeting with either Mr Obama or Mr Xi.

Mr Xi is visiting New Zealand next week after the G20 summit in Brisbane.

Mr Key and his wife, Bronagh, are today headed for Chengdu in Sichuan province, where he is due to open a new consular office for New Zealand and she is due to visit a panda breeding centre.

After that he will fly to Myanmar for the East Asia Summit.