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Japan's Democratic Party leader Yukio Hatoyama - Source: Reuters -
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Prime Minister John Key delighted his Japanese counterpart's wife with a gifted All Blacks jersey and emerged positive about gradual progress towards a free trade agreement on Thursday night.
Key was the first leader to be hosted by Japan's Prime Minister Yukio Hatoyama at his Tokyo residence, barely six weeks into the job since his Democratic Party's landslide election victory.
Bilateral and regional trade were the major discussion points, Key said afterwards.
Previous discussions between officials from both countries had stalled, and trade talks would now be "reignited".
"We've agreed to ask our officials to go away and start scoping out how progress might be made," Key told reporters at his Tokyo hotel.
But while Hatoyama made positive noises, he told Key there were still some potential hiccups from the viewpoint of New Zealand's third largest export market and fourth largest trading partner overall.
"The sensitivities are really in the agriculture side, particularly around beef and dairy. Not so on the lamb side," Key says.
"There's an acknowledgement that progress can be made, that we're very complimentary in nature and our seasons being different gives us an advantage."
Key says the "sensitivities" were true of any free trade agreement New Zealand entered into, particularly with the country's focus on agriculture.
In recent days New Zealand signed an FTA with Malaysia during Key's visit there.
Key and his wife Bronagh shared dinner with Hatoyama and his wife, and the All Blacks jersey was well received.
"We swapped rugby jerseys so that was a good starting point. He was highly supportive of the All Blacks and Hatoyama put on his rugby jersey and commandeered it before he had the chance to wear it himself. She's a diehard All Black fan now, for sure."
"He's a very charming man, and he's well disposed to New Zealand. We were his first dinner guests and he went out of his way to give us an extraordinary amount of time given he's 40-odd days in the job."
"He also had a real interest in New Zealand and I thought it was a very positive step for the relationship."
Hatoyama is keen to discuss his vision for establishing and East Asian Community including New Zealand and the likes of Japan, China, India and South Korea.
"He has a view that it should encompass trade and security and New Zealand could be a part of that grouping."
As part of that, he recently announced a proposal for Asian countries to switch to a single currency.
Earlier, Key caught the bullet train from Tokyo to Osaka to visit a biogas plant and a cheese factory, and deliver a speech at a business luncheon.
Later on Friday he will address the Japan/New Zealand Partnership Forum and the Japan Press Club, as well as attending the All Blacks' final training session before tomorrow's rugby test against Australia at the National Stadium.
He will attend Saturday's test and host a breakfast for local New Zealanders before returning home on Sunday night.
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