Rice hails New Zealand ties, holds back on trade deal

AUCKLAND Sat Jul 26, 2008 1:30am EDT

Secretary of State Condoleezza Rice (L) stands with New Zealand's Prime Minister Helen Clark at Government House in Auckland July 26, 2008. REUTERS/Nigel Marple

Secretary of State Condoleezza Rice (L) stands with New Zealand's Prime Minister Helen Clark at Government House in Auckland July 26, 2008.

Credit: Reuters/Nigel Marple

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AUCKLAND (Reuters)- U.S. Secretary of State Condoleezza Rice on Saturday hailed warmer ties with New Zealand but offered no commitment on a free trade deal the Pacific nation wants with Washington.

In a rare visit by the top U.S. diplomat to New Zealand, Rice said the relationship was in "good shape" after terse ties in the 1980s and 1990s.

"New Zealand is certainly seen as a friend and an ally," said Rice at a joint news conference with New Zealand Prime Minister Helen Clark.

The reference to New Zealand as an ally was one of the strongest public statements of support for Wellington since relations between the two countries were ruptured in the mid-1980s by New Zealand's anti-nuclear policy.

The policy prevented U.S. naval vessels from docking in New Zealand because the United States refused to either confirm or deny the presence of nuclear weapons on board.

The U.S. retaliated by banning military exercises with New Zealand. Asked whether Washington might consider lifting this ban, Rice was noncommittal.

"We have in recent years moved beyond a whole list of problems and we have really structured our relationship and our cooperation to meet the post-September 11 challenges," Rice said, referring to shared interests such Afghanistan, trade and environmental issues.

Around 60 people braved gale-force winds and driving rain to hold a noisy but peaceful demonstration opposing the United States's role in Iraq and treatment of detainees.

Clark, a critic of the U.S. invasion of Iraq, said the two nations were looking to what they had in common.

"Both sides acknowledge it (the relationship) is in a very good state today. We have both worked hard on that," Clark said.

But Rice offered no timeline on when a free trade deal might be brokered between the two nations, either bilaterally or via the so-called P4 group of nations -- New Zealand, Singapore, Brunei and Chile -- which already have a trade arrangement.

"I will take back the considerable interest that continues to be there on a free trade agreement," she said. "The United States should be committed to free trade agreements."

New Zealand's case for a full trade agreement with the United States, its second-biggest trading partner after Australia, was pressed by Foreign Minister Winston Peters in talks earlier in the day.

He said New Zealand had effectively "half a free trade agreement with the United States" because it allowed tariff-free entry to most U.S. goods and was worthy of a free trade deal.

"But we are positive about this 21st century relationship, and we will get there one day, and sooner than people think," Peters added.

New Zealand's major exports to the United States include meat, dairy products, wine and timber.

Rice is the first Secretary of State to visit New Zealand in a decade and her staff said the two-day trip was part of an effort to become more involved in Pacific issues and improve what they see as a continual warming of ties with Wellington.

Peters will fly with Rice on her plane to the island of Samoa this weekend, where the two will join Pacific foreign ministers for discussions about the region, including Fiji.

(Reporting by Gyles Beckford and Sue Pleming; Editing by Lincoln Feast)

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