John Key: We respect Britain's decision to leave the European Union

Prime Minster John Key said there are unlikely to be any immediate impacts on New Zealand in the wake of Britain's shock decision to leave the European Union.

Britain voted to leave the European Union after a bitterly divisive referendum campaign, sending global markets plunging, casting British politics into disarray and shattering the stability of a project in continental unity designed half a century ago to prevent World War III.

The Brexit cost UK Prime Minister David Cameron his job, and it launches a years-long process to renegotiate trade, business and political links between the United Kingdom and what will become a 27-nation bloc, an unprecedented divorce that could take decades to complete.

READ MORE: Brexit: British PM David Cameron announces he will resign after country votes to leave EU
Mr Key said he respects the UK's decision to leave the European Union and said it will take time to work through the implications.

"We will continue to have a strong relationship with both the EU and the UK, and to further develop our ties with both. In this respect nothing has changed," Mr Key said in a statement.

He continued: "The UK remains a member of the EU for the moment and it will take some time to work through the implications of their decision to leave."

Federated Farmers is urging New Zealand to be first in seeking a new trade relationship with the UK, but Mr Key says New Zealand will work with the UK as it goes through the process of leaving the EU to put in place new trading arrangements.

"In terms of our existing trade arrangements, the immediate effects of the leave vote on New Zealand are likely to be limited and we expect that trade and other business activities will continue smoothly in the interim.

"We remain committed to the launch of formal negotiations on an EU FTA, and will be working with the UK as they go through the process of leaving the EU to put in place new trading arrangements."

New Zealand First leader Winston Peters said the vote is a wake-up call for democracies everywhere.

"I joined the 'Leave' campaign at the 'Leave' campaign's request and I am delighted the British people exhibited the same character they showed when they confronted Hitler," Mr Peters said.

The trigger point that focused so many voters was the effect of mass immigration on their country, and their own economic and social futures, he said.

Simon Walker, a former NZ journalist who is the director-general of the Institute of Directors in the UK, told Radio NZ everyone was very surprised by the result.

He says markets will react further.

"There's no question it's a horrible blow for the British economy and it's going to take along time to work through it," he said.

The Leave campaign won with 52 percent of the vote, the UK electoral commission said. Turnout was high: 72 percent of the more than 46 million registered voters went to the polls.

READ MORE: UK votes to leave European Union

Earlier today the New Zealand swap rates plunged as news of the likely victory for Brexit in the UK's referendum rippled through global financial markets and sent investors fleeing for safe havens.

The two-year swap rate dropped 14 basis points to 2.17 per cent and 10-year swaps sank 22 points to 2.64 per cent as investors grappled with the looming outcome of the UK referendum.

Imre Speizer, senior market strategist at Westpac, said: "We'll be pricing a sub-2 per cent OCR (official cash rate) for sure - this might well be enough to tip the Reserve Bank's hand come August."

He continued: "We don't know how messy this could get - it's not so much the direct impact on the UK and on the rest of the world, which is pretty small beer, it's the contagion effect if the eurozone starts looking like splintering."

The Reserve Bank held off cutting the OCR at this month's meeting, saying this year's schedule meant a full monetary policy statement was in August and gave policymakers time to wait for data including first quarter gross domestic product and second quarter inflation.

Federal Reserve chair Janet Yellen this week said the world's biggest central was watching the outcome of the 'Brexit' vote.

READ MORE: Can the EU survive Brexit?

Australian Prime Minister Malcolm Turnbull expects the British exit from the EU will have an initial "shock" and create uncertainty, but stability will return soon.

Treasurer Scott Morrison, who was briefed by Treasury and Finance officials, told reporters Australia's exposure was "very limited".

The key issues were immigration, national sovereignty and how it might affect labour markets and the cost of investment in the UK, he said.