The United Kingdom should turn its attention from Europe to the "dynamic economic powerhouse" of the Commonwealth, New Zealand First leader Winston Peters has told the House of Lords.

Doing so would "heal a rift" with New Zealand that happened when Britain became a member of the European Economic Community in 1973, he said.

Mr Peters was invited to London by UK Independence Party (Ukip) peer Lord Pearson of Rannoch.

Britain will vote in a "Brexit" referendum on whether to leave the European Union on June 23. Ukip are pushing strongly for Britain to leave the EU.


In his speech to the House of Lords, Mr Peters said whether to leave or stay in the EU was a decision for the British people, but they should also push for the creation of a Commonwealth Free Trade Area.

"Why trade on a continental scale when you could really trade on a global scale? The Commonwealth is now a dynamic powerhouse crossing every time zone and trading session in the world," Mr Peters said.

"In 2014 the Commonwealth produced GDP of $10.45 trillion, a massive 17 per cent of gross world product. Seen that way, the Commonwealth could be a colossus.

"Part of the choice the UK faces is of a Europe, divided and indebted, or trade in the developed and emerging economies of the Commonwealth."

Prime Minister John Key discussed the Brexit referendum during a meeting with British Prime Minister David Cameron while both leaders were in Washington DC before the two-day Nuclear Security Summit in April.

Afterwards, he told media that Europe is stronger with Britain in it and if New Zealand wasn't so far away it would want to join such a union.

Mr Cameron wants Britain to stay in the EU. Barack Obama has also weighed in on the issue, warning at the end of a three-day visit to the UK in April that it was wrong for Brexit campaigners to suggest it would be straightforward to agree a new trade relationship if Britain left the EU.

Mr Peters was critical of such comments.

"None of those leaders asked their people, or your people first," he said in his speech. "This is a decision that the people that once made Britain great, alone must make."

In February and speaking to an agricultural related industries conference in Auckland, Mr Peters backed an exit by Britain of the European Union, saying Norway had shown that Britain could flourish outside the EU.

Mr Peters noted that Conservative MP and London Mayor Boris Johnson supported an exit from the EU and had backed travel and work zones between Britain, New Zealand, Australia and Canada.