China, Australia to lead revival of New Zealand tourism industry

WELLINGTON -- A growing Chinese market and the continued economic strength of Australia are set to drive a revival of New Zealand's tourism industry, according to a New Zealand government forecast released Tuesday.

The forecast from the Ministry of Business, Innovation and Employment predicted international visitor spending in New Zealand would grow by 9 percent by December 2018 and visitors numbers would be up by 28 percent.

The report said the industry would continue to have a challenging outlook for the next year or two as a result of the Global Financial Crisis.

However, Chinese visitor spending had grown rapidly, even during the GFC, and while the short-term outlook for the Chinese market over the next year or two was for "moderation," the medium to long-term outlook was strong, it said.

Acting general manager for tourism, sectors, regions and cities Adrienne Meikle said the report -- New Zealand's Tourism Sector Outlook: Forecasts for 2012-2018 -- pointed to a significant structural shift in New Zealand's tourism industry.

"Traditional markets like the United Kingdom and United States will continue to decline in the absence of any active market intervention, but this will be off-set by strong growth from China and Australia," Meikle said in a statement.

"New Zealand will face continuing challenges as a destination for traditional markets, due to the global financial crisis and emergence of low-cost European airlines. The forecasts provide encouragement for New Zealand's tourism industry to do more to attract and cater for visitors from our Asia-Pacific neighbors."

The forecasts predicted the average spend per day would remain steady, but shorter visits by Australian and Asian visitors would shorten the average length of stay.

Meikle says the forecasts provided a starting point for industry discussions about what might happen within New Zealand's inbound visitor market over the next six years.

Tourism Industry Association chief executive Martin Snedden said the forecasts showed where efforts were needed to underpin growth predictions or to lift market performance.

"Clearly China will be a big growth market but there is no room for complacency. We need to ensure that we keep improving the quality of the visitor experience to secure greater spend from this important sector," Snedden said in the statement.

"In medium-risk markets such as Japan and the US, there is optimism that positive change is already underway, evidenced by Air New Zealand's recent decisions to increase its capacity out of both countries. The UK and Europe remain challenging, but these markets remain important for New Zealand," he said.

"The overarching message that can be taken from these forecasts is that if the industry, with Tourism New Zealand, can continue to adapt effectively within this fast-changing environment, and if we can keep improving the quality of the visitor experience, then tourism will continue to be a strong contributor to New Zealand's economy."