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Burton Speech: 40th anniversary TAANZ Conference

40th anniversary Travel Agents Association of New Zealand (TAANZ) conference

I am very pleased to join you this morning—and to add my welcome to you, to my electorate and hometown. I can think of no more appropriate location to address you about the value of travel and tourism to New Zealand’s economy.

2002 has been quite a year for the travel industry. This time last year, the entire tourism sector was reeling from the events of September 11th. New Zealand, like the rest of the world, had suffered a significant downturn in international visitor numbers.

And for a small nation, which depends on tourism for 10% of our GDP, one in ten jobs, and over 15,000 businesses, the outlook for the future looked less than certain.

However, in confronting this unprecedented challenge, there was room for some optimism. Our tourism sector was strong, and we had during the preceding 2 years built effective partnerships between the Government and the industry, that would enable and sustain a cooperative recovery effort.

In addition, the fact of our relative geographic isolation—our distance from almost everywhere—became for many, a distinct advantage.

In the period immediately following September 11, key tourism sector representatives worked tirelessly with the Government, under the co-ordination of Tourism New Zealand, to carefully promote New Zealand’s global reputation as a safe, friendly tourism destination.

Working together, we were able to ensure that a consistent, calm assessment of the emerging domestic and international situation was communicated.

As a result, New Zealand was able to mobilise a swift, well-coordinated response. And by January, unlike most other global destinations, we were back onto a growth path. Throughout 2002, the outlook for tourism has remained positive.

The industry has demonstrated the same, measured resolve when faced with the recent tragedy in Bali.

The determination, hard work and resolve have paid off. In the twelve months since September 11th, New Zealand attracted nearly 2 million international visitors—up 1.5 percent on the previous year and an all time high.

But what is even better news is that these visitors spent 14 percent more and stayed 9.2 percent longer, putting $9.5 billion dollars into the New Zealand economy.

As these figures indicate, tourism is becoming an increasingly important phenomenon, both in New Zealand and around the world. Between 1950 and 1999 the number of international visitor arrivals worldwide grew from 25 to 664 million (representing an annual average growth rate of seven percent). This growth is expected to continue, with the number of international visitor arrivals worldwide forecast to grow to nearly 1 billion by 2010. Increasingly, tourism is becoming a key driver of economic development in New Zealand. Foreign exchange earnings from overseas visitors have jumped 95 percent since 1997 and now total almost $6 billion. As I’ve noted, earnings are up 14 percent on last year alone, and 88 percent of all visitors say they will return. Tourism also plays a key role in the growth of the New Zealand economy through employment, investment and regional development. In 2000, 94,000 full-time equivalent employees were directly engaged in tourism. An estimated 163,000 people are indirectly employed by tourism. New Zealand may be a relatively small player on the global market, but travel and tourism are extremely valuable to our economy. And that value goes well beyond simple dollars spent—it flows on into almost every aspect of our society. In the regions of New Zealand, the development of tourism creates jobs and business opportunities, often providing the boost needed to develop these communities. Taupo is of course a prime example of this, as is the Kaikoura district in the South Island. Although most of Kaikoura’s publicity surrounds high profile operators such as Whale Watch, the district’s entire economy has experienced the flow-on benefits of tourist spending. Visitors also provide the motivation for local and regional councils to build and maintain high quality leisure facilities. Businesses, too, have an incentive to provide a wide variety of high-quality goods and services. As a result, we all get to enjoy access to facilities and services supported by our international and domestic visitors. Tourism also allows us to showcase New Zealand culture to the world. Cultural tourism offers visitors a wide range of experiences, from Maori culture to wine tours to internationally recognised events such as the Wild Food Festival, the World of Wearable Art Awards and Pacifica. By marketing these kinds of events, Tourism New Zealand is creating a powerful point of difference in our international marketing. Broadening New Zealand’s image overseas is an essential part of achieving the goal of a sustainable tourism sector, which is outlined as a key objective in the New Zealand Tourism Strategy 2010.

The goal is to build a sustainable, yield-driven industry, one that strikes a balance between growing tourism demands and financial returns, while still enhancing both our visitors’ experience and New Zealanders’ quality of life.

In other words, we must ensure that whatever we do in the short term will guarantee the prosperity and growth of the industry in the long term, while still protecting and preserving the environments and values of New Zealand.

To achieve this, we must put quality at the heart of the tourism industry. We must ensure that every visitor receives a world-class experience—in their accommodation, their food, their activities they choose and the environments they visit.

Quality was also outlined as a key factor to success in Strategy 2010, and as a direct response to this, the Government has launched the Qualmark brand.

Quite simply, Qualmark aims to provide visitors with a reliable standardised quality assurance system. By using the Qualmark system to ensure that a high standard is maintained across all aspects of the tourism sector, visitors, businesses and the industry as a whole will all benefit.

The government is investing an additional $2.5 million in Qualmark over the next two and a half years, to significantly expand the grading system. Qualmark will now include not only accommodation and tourism retail, but also adventure tourism, transport activities, eco-tourism, and attractions.

In addition, Qualmark will also provide a business certification process to encourage best business practice adoption in the tourism sector.

Quality, balance, and diversification—they are all essential to sustainability. Appropriate growth in visitor numbers is still important, but New Zealand’s long term interest is best served if these visitors come year-round, stay longer, and see not only the traditional spots, but venture out into all regions.

This way, we can both improve our visitors’ experiences and protect what attracts them in the first place: our unique environments, and the communities and cultures of New Zealand.

This shift in marketing focus is mirrored by changes in the travel business itself. Advances in technology—particularly the web—mean that the role of an agent has changed. People are now able to book their own overseas travel. This does not mean, however, that the agent’s role has disappeared. Indeed, your role is changing dramatically: from that of primarily a travel organiser to a far greater emphasis on the role of expert planner—one who adds significant value to the consumer’s travel experience. One-to-one marketing and customer contact is certainly possible in today's travel environment. Indeed, the importance of personalisation in online travel cannot be overstated. The channels that manage the exchange may have changed, but the rules of good customer service have not. Good sales skills are still about being a trustworthy advisor, having strong product knowledge, and knowing your customer’s needs. Technologically, the world of travel is shifting, and in this new environment roles within the system must also change. But it’s vital to see these changes as an opportunity to maximise benefits rather than as a threat in the business of travel. I certainly encourage you to make the most of the opportunities new technologies present. To that end, some of you might like to contact Technology New Zealand, a Government-supported agency that provides information sources and supports technological development projects in business. They are there to help you overcome any difficulties you might be having in adopting new technologies to aid in your business development. The New Zealand tourism sector is thriving, and it’s a pretty exciting field to be in right now. The Mayor and I have just come from starting the Taupo Cycle Challenge, the largest cycle event in the Southern Hemisphere. And, thanks to events like the America’s Cup, the future is looking bright indeed. America’s Cup 2000 proved to be an enormous boost, both to Auckland’s economy and to the New Zealand economy as a whole. With 35,000 overseas visitors and significant expenditure by syndicates, organisers, sponsors, tourists and the Government, the America’s Cup 2000 injected $640 million into the economy and created the equivalent of almost 11,000 new full-time jobs. And the build-up to the 2003 defence has been more intensive. More substantial challenge campaigns have been developed, with larger budgets and a wider commitment to two-boat campaigns. In addition, this year we have 200 super-yachts arriving and many other visitors coming to Auckland by private jet and first class airline travel. The America’s Cup offers New Zealand an unprecedented marketing opportunity. It attracts niche market visitors, with the discretionary income to travel the country and enjoy the very best New Zealand has on offer. Many visitors go on to visit destinations such as Northland, Taupo, Rotorua, Marlborough, and Queenstown. And the America’s Cup is just one of many events positioning New Zealand as a desirable tourism destination. It complements and adds to the momentum created by such events as the Lord of the Rings film trilogy, the Discovery Channel’s Royal Tour documentary, and the filming of The Last Samurai (as well as a host of other prospective film projects). I think it’s clear that you can all be proud of the tourism sector’s achievements. I believe that tourism will continue to play a leading role in the transformation of the New Zealand economy. However, celebrating these achievements does not mean that we can afford to become complacent. On the contrary—now is the time we must redouble our efforts to ensure that we build on our progress thus far and make tourism a genuinely sustainable industry. We need to demonstrate the flare, originality, determination and unwavering commitment to quality that drives the creative film projects and yachting campaigns of which we are all so proud. And so, in conclusion, we come back to the original topic: The Value of Tourism to New Zealand’s Economy.

If we can build on New Zealand’s ‘100% Pure’, safe and idyllic image overseas, while at the same time growing the industry to its full potential, then tourism will become an even greater contributor to this government’s long term goal of moving New Zealand up into the top half of the OECD.

Clearly, no one agency can make it happen in isolation. If the vision of a sustainable tourism industry is to be truly achieved, Government and industry must continue to work in partnership across the sector. It’s an exciting time to be in tourism right now. The industry is experiencing unprecedented growth. But it’s up to all of us to get the balance right. People come to New Zealand because what we have to offer is unique.

Protecting and preserving our core environmental values and assets is what sustainable tourism is all about.

We must protect those unique things about New Zealand that lure visitors halfway around the world to see. We must make sure that they have a world-class experience—one that leaves them longing to return. In other words, we must make it our aim to exceed the expectations of every single visitor to New Zealand. So let me say congratulations on your achievements in this challenging year. Thank you for the opportunity to meet with you this morning, and I wish you all the best for what I am sure will be a most interesting and engaging conference, and an enjoyable and restful visit to the Taupo District.

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