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During a visit to Sapporo, Otago deputy vice-chancellor, research and enterprise, Prof Richard Blaikie and Hokkaido University president Toyoharu Nawa, signed the agreement and a separate student exchange agreement.
The agreements would encourage research collaboration, allow for academic and professional staff exchanges and up to six student exchanges each semester.
Prof Blaikie said the signing cemented relationships that had been growing between faculty members for years, some across many decades.
"Research and teaching collaborations are active across a number of areas of mutual interest, including geology, earthquake sciences, marine biology and fisheries.
"That reflects the common characteristics our two island nations share on the Pacific Rim," Prof Blaikie said.
Regular student exchanges would allow deeper cultural understanding between the universities.
"Our two universities share common characteristics of size, age and ambition to promote excellence in all our endeavours."
Hokkaido University, also known as Hokudai, was founded as an agricultural college in 1876. It is now one of the national universities of Japan and has about 18,000 students.
The signing was attended by Prime Minister Bill English.