Prime Minister John Key has conceded the Trans Pacific Partnership is unlikely to progress following the election of Donald Trump as US President.

LISTEN ABOVE: John Key talks to Mike Hosking about what Trump's win means for the TPP

Key said this morning that he was pessimistic about the 12-nation trade deal being ratified before Barack Obama left office.

"We'll work our way through it," he told Mike Hosking. "It's bad in the sense that it's very hard to see TPP progressing now in that lame duck period."

While Trump's election was bad for the TPP, it was not necessarily bad for all trade between New Zealand and the United States.

"I think over time Donald Trump has said he just doesn't like the deal, not so much that trade can't work," Key said.

New Zealand's economy was "cranking", with growth rates of at least 3.5 per cent, he said. 

"The reality is we've done all that without TPP. So it's just a bit of a lost opportunity in the short term for us.

"His argument when you think about hasn't been that trade is bad. He just keeps saying 'this is a horrible deal, this is a horrible deal'.

"Well, let's see their capacity to negotiate a better deal I suppose."

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Key said he did not fear a trade war between the United States and China. 

Trump won the election by mobilising blue collar voters, Key said, and if he were to put a 45 per cent tariff on Chinese goods it would reduce this group's purchasing power. 

"So again I'm not saying he isn't going to do what he said. But it might be a lot more nuanced or it might be a bit more of a threat to see some sort of change in certain areas.