Good morning,

I am honoured to have the opportunity to deliver a keynote address at this Korea-New Zealand Business Roundtable focusing on "complementary economies, shared opportunities". 

I am pleased so many business leaders from our two countries have chosen to attend and support this event.  It reflects good organisation on the part of the Korean International Trade Association and New Zealand International Business Forum in putting this event together.

I am also pleased and very honoured to be here today with my counterpart Minister Kim Jong-Hoon.

This event is a sign of the strong and friendly bilateral relationship between Korea and New Zealand.

History of New Zealand-Korea relationship

This relationship between our two countries is underpinned by our shared bond in the Korean War almost 60 years ago.  Over 6,000 New Zealand troops served in Korea and New Zealand continues to lend its support to efforts to build a safe and stable Korean peninsula through the United Nations Command. 

New Zealand is committed to working together with Korea and the international community to convince North Korea to change from its current unhelpful path.

Then came a period where New Zealand provided development assistance in the form of model beef and dairy farms, technical exchanges and university scholarships.  An estimated 300 Koreans, for example, studied or trained in New Zealand in the 1960s and 1970s under the Colombo Plan.

Reflecting on that today, as I return to Korea once more, it is almost unthinkable that New Zealand was an aid donor to Korea little more than three decades ago.   I say this mainly because of the rapid transformation undergone by Korea over that time, a transformation that has become a model for developing country growth.  The story of the Asian tiger economies is of course well known. But as we gather here today in the midst of the deepest economic recession since the 1930s, I think it's worth reflecting on a little of that history.

The story of South Korea's market-led, export-led strategy is an incredible one for which I have deep admiration.  Korea today shows the benefits of having taken full advantage of the global revolution in information, communications and transportation. 

We have witnessed the development of a global manufacturing leader - first shipbuilding and now electronics and semi conductors.   Today, Korea is the most wired country in the world, a subject I to which I will return.  In short, Koreans have a great deal to be proud of.   

But changes over recent decades have not taken place in Korea alone. New Zealand too has undergone its own economic transformation.  Britain's entry into the EEC in 1973 spurred a diversification of New Zealand's economy and export markets.  Then, faced with near economic ruin in the 1980s, the New Zealand economy underwent a massive restructuring.  Today we are seeing the benefits of a more efficient, outwardly facing economy.

Many of the New Zealanders here today will recall, for example, the virtual overnight dismantling of a car manufacturing industry.  This was painful for those workers that lost their jobs.  But it did force changes that were overdue and two decades later companies such as Hyundai, Daewoo and Kia are well known brands in New Zealand.  Samsung is another major brand in the New Zealand market, its success in part made possible by the dismantling of a state telecommunications monopoly.

Complementary Economies

So if this is a story from aid to trade, then it is one driven by changes in both countries.  Today, Korea is an important partner for New Zealand in trade, investment, science, agriculture, technology, and film.  Korea is New Zealand's 9th largest trading partner with two-way trade worth almost NZ$2.7 billion, or 2.1 trillion Won, in 2008.  Korea is also New Zealand's 2nd largest source of international students and 6th largest source of visitors overall, accounting for more than 90,000 visitors in 2008.

What we see now is two globally facing export-oriented economies.  And the theme today - complementary economies - is very fitting to this relationship

New Zealand exports meet Korea's industrial processing needs and Korea supplies important capital and consumer goods for New Zealand. 

Beyond trade, the relationship between New Zealand and Korea has matured to the point where our two countries have deep engagement across all pillars - including science, education, and people-to-people linkages.  We have many shared values and a similar vision for moving forward into the 21^st century.

More than 30,000 Koreans have made New Zealand their home, one of the highest expatriate Korean communities in the world on a per capita basis.  This community contributes much to New Zealand, enriching our culture, society and economy.

Among New Zealand Koreans are some prominent individuals we can all celebrate.  My National Party colleague Melissa Lee became the first New Zealand Member of Parliament of Korean descent at last year's general election, and the first woman of Korean descent to become a parliamentarian outside of Korea.

Teenage golf sensation Danny Lee won the US Amateur championship last year, the youngest player do so since 1895 and more than six months younger than Tiger Woods when he won the title. 

The Korean community in New Zealand provides a vibrant base for the bilateral relationship.  We welcome its presence. 

And of course, there are a couple of thousand New Zealanders who have made Korea home or who have taken the opportunity to work here and do business. 

These communities provide an excellent basis to grow this relationship into the future.

So I see a relationship with great potential.  Of course in the current economic climate it may seem difficult to appreciate this. 

The WTO has predicted that global trade flows will shrink by 9% this year.  This contraction in trade could be compounded further by protectionist measures.

In this climate, gaining and maintaining access to valuable and dynamic markets is more critical to exporters than ever. 

Recent research from the OECD supports what our own countries experiences bear out - a 10% increase in trade is associated with a 4% rise in per capita income, demonstrating a clear linkage between trade and overall prosperity.

In the face of these difficult economic times, the answer is to persist down the same track that has transformed our respective economies. 

Launch of FTA negotiations

Our leaders know the contribution that trade can make.  I was delighted when, in March, the President Lee Myung-bak [pron. Ee Meong-bak] and my Prime Minister, John Key, jointly announced the launch of negotiations towards a free trade agreement.

This is a goal that New Zealand has been working towards since 1999 and represents New Zealand's first FTA negotiation, since CER with Australia in 1983, with a fellow OECD member.

It is fitting that you - the leaders from our respective business, government and academic sectors - have gathered in Seoul for this event in the same week as the first round of those negotiations.  I am looking forward to working closely with my counterpart, Minister Kim Jong-Hoon, to conclude quickly a high quality FTA.

New Opportunities

A high quality Korean-New Zealand FTA will not only strengthen the complementary trading relationship; it will also provide incentives to explore new areas of cooperation.  This is a point I wish to emphasise - my government sees an FTA as providing a framework for future economic and wider engagement between New Zealand and Korea. 

Two possible areas where truly exciting opportunities are emerging are topics that this Business Roundtable is focused on - information and communications technology and green growth.

A joint statement issued by our two leaders when they met in New Zealand in March agreed to strengthen cooperation between Korea and New Zealand in both these areas.

In the ICT sector, particular mention was made of industry-to-industry collaboration on applications that can stimulate demand for ultra-fast broadband.

This is a topic that I am passionate about.  As I said earlier, Korea is the most wired country in the world.  It is a world leader in the development and commercialisation of new technologies such as wireless broadband and ultra-fast fibre networking technology.

New Zealand has strong capabilities in research and leveraging off high-technology.  Our companies and institutes continue to develop innovative systems and high-quality digital-content.

The New Zealand Government has committed to accelerating ICT development, with additional public and private sector investment.  A Broadband Investment Initiative was proposed in March with the objective of rolling out ultra-fast broadband to 75 per cent of the population.

These synergies in the ICT sector were recognised at both government and industry levels through the first Korea-New Zealand Focal Point Programme, established in 2005.

One of the successful projects under the programme has been New Zealand's University of Auckland and Korea's Electronics and Telecommunications Research Institute robotics project.  ETRI's expertise in robotics technology has been paired with University of Auckland's expertise in software design to develop systems that could be potentially commercialised for use in healthcare for the elderly.

The annual Korea Australia New Zealand Broadband, or KANZ, Summit is another excellent initiative to assist ICT collaboration.

This year's event will be held in New Zealand's commercial hub, Auckland, in November.  It will provide an opportunity to showcase industry developments and for some high-level networking - so I hope that some of you in this room will be able to attend.  I will certainly be rallying attendance by Korean Ministers.

On green growth, the joint statement made by our two leaders highlighted potential mutual benefits from working closely together on clean energy sources.

Again, there are synergies between New Zealand and Korea's energy sectors that provide the basis for such collaboration.

Korea has an admirable policy focus on increasing the contribution of renewable energy from 2.4 per cent of total energy consumption in 2007, to 11.5 per cent in 2030.  Under that goal, it will no doubt be seeking to invest in research and development in this area.

New Zealand's clean, green reputation is supported by its use of substantial amounts of hydro, geothermal and wind power to meet its energy consumption needs. 

We also have growing expertise in 'second-generation' biofuels from cellulosic feedstocks. The New Zealand government supports sustainable biofuels and market initiatives that encourage their deployment.

Our two science ministries are already planning to cooperate on renewable energy with a focus on climate change under the 2nd Korea-New Zealand Focal Point Programme, begun in March. 

Despite the current global economic challenges, I believe I have every reason to anticipate an exciting shared future for New Zealand and Korea. 

The changes in both economies over this time are due to meeting with determination and creativity the challenges and opportunities presented by globalisation.  It is my strong hope that the trade negotiations which have commenced this week will deliver a new platform from which our trade and economic relationship can accelerate in the years ahead.

I wish you all the best for a productive series of discussions at the Business Roundtable.