New Zealand is set to open a High Commission in Sri Lanka next year to cement ties and increase business between the two countries.

New Zealand Prime Minister John Key made the announcement after meeting with visiting Sri Lankan Prime Minister Ranil Wickremesinghe.

Both countries have committed to reducing tariffs on goods, especially dairy, though Key said he wasn't seeking to put Sri Lankan farmers out of business.

Economic Development Minister Steven Joyce, Trade Minister Todd McClay and Primary Industries Minister Nathan Guy will be attending talks.

Prime Minister Ranil Wickremesing told media they also want assistance in the education sector, especially teaching of English.

Sri Lanka is also looking at New Zealand's political system, Wickremesinghe said.

"The Sri Lankan parliament is seriously considering taking on the New Zealand MMP system, which means there'll be more Sri Lankan MPs down here studying what is happening."