Winston Peters is refusing to apologise for a joke about Chinese that has been labelled shameful and racist.

"As they say in Beijing, two Wongs don't make a white," the New Zealand First leader said in a speech yesterday.

He was talking about National and Labour having both sold land to foreigners.

Mr Peters thinks the joke was funny.

"The truth is the Chinese guy in Beijing told me that. And he thought it was funny. And I still think it's funny," Mr Peters told ONE News today.

But the Race Relations Commissioner, Dame Susan Devoy, doesn't see the humour.

"I think it's extraordinarily offensive. And I think it's not a joke, it's not funny. And I think Winston and others actually need to move beyond that," she said.

Mr Peters responded: "If that's all she's got to do, she better find a new job."

Unfortunately for Mr Peters, the joke's origins do him no favours. It was first used in 1947 by an Australian MP who was also a keen supporter of Australia's whites only immigration policy. And just as it did 70 years ago, the joke's still ruffling feathers.

"He has sprayed and walked away hasn't he. I mean, you know, he leaves a terrible xenophobic stench every time he actually opens his mouth. It's election year," said Melissa Lee, a National ethnic Asian list MP.

Mr Peters referred yesterday to Mr Key as "Mr Spray and Walk Away", in reference to a television ad featuring an Asian presenter.

National ethnic Asian list MP, Dr Jian Yang, says the New Zealand Chinese community will feel offended.

Act deputy leader Kenneth Wang also expressed outrage.

"I think it's very sad and very pathetic that Peters, he has to resort to this cheap and racist attack."