Hon Damien O’Connor
Minister of Corrections
Minister of Tourism
Minister for Rural Affairs
Associate Minister of Health

Embargoed 6pm 9 May 2007 Speech Notes

ITOC trade day speech – investing to get the most out of China

Kia Ora.

Thank you for having me along to your event this evening. I understand it has been a busy day with many new products on show.

I am encouraged by the quality of our tourism offerings across all regions of New Zealand, and congratulate each RTO here for showcasing their products at this event with such enthusiasm.

I’d also like to take the opportunity to thank Graeme Osborne and his team from Tourism Auckland for initiating, underwriting, and organising the event.

Because of their efforts, this event has been held every year since 2001 and has been well supported by the majority of RTOs.

Paul Yeo from ITOC should also be acknowledged for his support and communications efforts through the ITOC organisation. Thanks to you both.

Many of you will be aware that we have been working on a mid-term update of New Zealand’s tourism strategy. I plan to release a draft of this discussion document next week and invite you all to provide your feedback.

It is quite simply a watershed moment for our industry. We have done so many things very well, and have learned many lessons about how to develop, promote and deliver on New Zealand's tourism promise.

The challenge before us is to continue this smart strategic approach which combines the best of government and industry, but to add to this a new appreciation of what sustainability truly means.

A theme running through the revised strategy that underpins all the others is the need to deliver an enduring future for tourism that will maximise its value to all New Zealanders.

This requires us to make sure we ensure the financial success of our businesses and the satisfaction of our customers and have the support of our communities.

While each of these goals require specific policies, investment, and guidance – or leadership, in a nutshell – we will achieve none of them long-term if we do not protect our physical environment or manage the sustainability of our businesses and culture.

The strategy update provides us with a great opportunity to lay the foundation for our industry for many years to come.

One of the issues our industry is grappling with is how to get the best out of our fastest growing market.

In this vein, I am pleased to be able to announce this evening significant new funding aimed at lifting the quality within our fastest growing market – China.

We all know there have been problems in this market with a predominance of low quality leisure tours that are of short duration, and often focus heavily on shopping commissions to make up for below-cost pricing.

As our fastest growing market, which is expected to become our fourth largest by 2009, it is important that we manage the growth in a sustainable manner.

Doing so will enable us to deliver the best possible outcomes to the tourism sector and New Zealand.

I’m pleased to announce this evening that the Government is to invest $7 million over the next two years for increased marketing in China.

This investment recognises that there is currently a low level of awareness in China of New Zealand as a travel destination.

At the moment, our Chinese visitors typically come here as an add-on to their Australian tour with relatively low expectations on what they will see and experience here.

We want to ensure that Chinese people see New Zealand as a travel destination in its own right, and as one that delivers a world-class experience of stunning scenery and top quality service and products.

We also want to attract high-yielding visitors – that is those who have more money to spend, and more time to enjoy New Zealand. They will have a much better story to tell when they arrive home.

Tourism New Zealand will run a marketing campaign in Chinese cities that have the highest concentration of high value travellers, who are looking for new travel opportunities.

In line with the marketing in our other key markets, the new China efforts will involve an annual integrated media campaign, including local television, print, Internet and events.

Our new marketing presence in China also ties in well with the existence of direct flights between Auckland and Shanghai. Air New Zealand is now flying five times per week, which can only help to encourage single destination travel to New Zealand.

In addition to these new marketing efforts, we are also working to improve the Approved Destination Status system.

New Zealand and Australia were the first western destinations to received ADS from China back in 1999, which effectively opened the door for Chinese visitors to travel to New Zealand on holiday.

As part of the Government’s commitment to lifting the game in this important market, I can confirm this evening that the administration of the ADS system will soon be handed over to Tourism New Zealand.

I would like to thank ITOC for its on-going efforts in ADS, which will continue as we implement the new arrangements and transition over to Tourism New Zealand.

The new ADS arrangements will mean that all inbound operators will have to re-apply for ADS approval, and will be required to commit to a new Code of Conduct setting out minimum levels of quality and monitoring expectations.

The Code and other details will be available within the next few weeks.

New information sharing and enforcement arrangements are a vital component of the new ADS system.

We are implementing a system where all service providers will be accountable for the quality of the experience delivered to our Chinese visitors.

The various government agencies that enforce laws relating to a tour will be sharing information, with Tourism New Zealand playing a key co-ordinating role.

This will give us oversight on low quality and non-compliance issues and act accordingly.

This is a commitment to remove the opportunities for below-cost pricing and shift our focus to improving quality.

The government recognises that China is a critical emerging market for New Zealand and we have a window of opportunity to exploit the focus on New Zealand.

The investment in this year's Budget recognises this year as Export Year, and furthers the Government's commitment to lifting productivity.

To finish, these are exciting times for tourism, with risks and opportunities ahead.

I firmly believe that the good relationship that exists between industry and government, made possible by the relatively small size of our country, means that we will be united and nimble enough to stay ahead of global concerns.

We must show leadership. I believe we will.

Many of you will be at TRENZ in a couple of weeks so I look forward to seeing some of you in Rotorua. I wish you all the best for that important event and thank you again for inviting me to speak tonight.

ENDS

© Scoop Media