Associate Professor Anthony Brien, Dr Hafsa Ahmed and Dr David Dyason (Faculty of Agribusiness and Commerce, Lincoln University) 

Prior to March 2020, international tourism was New Zealand’s largest foreign exchange earner, and with the year ending 2019, the 3.8 million international visitors added $17 billion into our economy. That was 20.1 per cent of all New Zealand’s foreign earnings. The industry’s value to the economy was bigger than agriculture and similar to the financial services industry, growing at a considerable pace for many years and projected to grow further. Then in March 2020, COVID hit. Our borders were and remain closed to international tourists.

For the tourism industry and individual tourism businesses, COVID has been economically devastating. Yet others see COVID’s arrival as a positive opportunity to re-set an industry – socially and environmentally. However, no matter your point of view, at present, there is no plan for the strategic return of less, the same or more international tourists, albeit borders are said to be opened later this year. Tourism is down, but not out, and on so many levels - socially, environmentally, and economically, New Zealand needs international tourism back ASAP. Failing to plan for its re-introduction is planning to fail.

We continually hear the phrase that tourism needs a ‘re-set’, and as part of that, the government is proposing a shift away from the same number of tourists we are used to welcoming, to focusing on high-value international tourists. However, there does not appear to be a strategic plan for this. While we agree with aspects of a re-set, we do not believe the suggested (potentially fewer) high-value tourist approach is a sustainable or achievable goal. It is highly unlikely to match the economic and social contribution that our 2019 international tourists made.

While we disagree with the proposed focus, we also see no urgency to bring back international tourism to the economic levels we need. While the rest of the world opens up, we are lagging behind. We are not suggesting opening up recklessly, but we can't find any strategic plan for the urgent re-engagement of international tourism that will allow us to compete with the rest of the world and get back the economic gains such tourism brings. Just opening borders will not be enough, especially if the domestic spender travels internationally, resulting in a further loss to the economy. Therefore, we present a targeted goal for international tourism that we acknowledge may shock many.

Our recovery target is to urgently market New Zealand to the world and welcome 3.8 million international visitors by December 2023.

Many will say this goal is unachievable, will never happen, people will not travel like they used to, or do not want it to happen, or it should not be allowed to happen. Then some, possibly tourism operators, will say this is a terrific idea. But, we have good reasons to socialise and promote this targeted plan. Indeed, we believe there are serious negative future social and economic implications for New Zealand if we don’t have such a plan and target. It’s a tough target to hit, but we must believe we can do it.

As we said, at present, the government (who are major benefactors of international tourism) propose a future international tourism industry to consist of high-value (possibly fewer) international tourists, which is laudable, but we cannot find any public details of how such a plan would work. We go as far as to suggest that this approach is betting on an unknown, rather than the known of our past international tourist make-up. We challenge this approach further with several questions: What is high-value? Who is high-value? How could we stop low-value tourists (whomever they are) from coming here? Will potential international tourists have to show us their bank account to determine their high-value status before we allow them to travel here? Is visiting friends and family subject to similar restrictions? Who will decide who is high-value?

Our recovery target is simplistic and regains the benefits while reducing the downsides that were appearing. It is far from an immediate return to business as usual; it will take time to get international tourism back, but we have much ground to make up, and we must move now.

In 2019, New Zealand welcomed 3.8 million international tourists who spent $17 billion while they were here. However, we acknowledge there were growing and arguably real concerns in New Zealand about ‘over-tourism’ and its impact on local communities and the environment. While acknowledging the highlighted negatives, as a country, we heard less and did not complain about the benefits of international tourism – the $17 billion and the social contributions of jobs, more coffee shops, eateries, activities, etc., available to all New Zealanders. Nor did we complain about the $1.77 billion in GST paid by international tourist spending to the government (8% of all total government GST income) who used that for distribution into social services, etc. Then there were the 365,800 people employed (direct and indirectly) in the tourism industry who contributed to the government income via PAYE.

The issue that should worry every New Zealander now is how to fund, in some way or other, this financial gap for the government to maintain services. If we don’t want to fund it ourselves, and this is a very big funding hole to fill, New Zealand urgently needs international tourists back to the 2019 level as soon as possible.

What we have just spoken about is filling the hole of lost revenue, but that’s only part of the story of why we urgently need international tourist back. The other side is the deeper financial and social hole we are digging when we don’t have these international tourists.

New Zealand still has the essential infrastructure it had in December 2019 to cope with 3.8 million international tourists - the roads, airports, accommodation, local services, etc. These have not and are not going away. However, we acknowledge that much of the public infrastructure (roads, parks, etc.) were creaking under some strain of the tourism numbers, yet we, like many others, believe there are solutions to this.

New Zealand's main highways and airports funded by the central government were built to cope with the international tourist traffic, just as were regional roads and airports funded by local councils. This is the infrastructure that most New Zealanders now enjoy, which was, in part, paid for and maintained by international tourists, and this infrastructure still needs to be maintained.

Now consider that a fewer, high-value tourist approach which has no way of guaranteeing the funding we received in 2019 will be available going forward, and we have a major problem. For this infrastructure to be maintained, someone must pay for it – and if we want fewer international tourists, it will be the taxpayer and ratepayer. From a NZ Inc. business perspective, it makes no sense to underuse its invested assets. New Zealand is, with some adjustment, set up for 3.8 million international tourists – why waste that investment and opportunity and why make New Zealanders pay more than they have to?

Then there is the significant infrastructure such as hotels, motels, and backpackers who are less likely to be used under a fewer, high-value international tourist approach, so what happens to them? Do we pull them down? Does the government buy them and turn them into social housing? What happens if owners close the operations and they end up derelict, vandalised buildings and does that create more social issues? Many airports will have significantly underused facilities but still cost in terms of up-keep, and in each of these cases, there are considerable downstream impacts such as less employment in these areas and those servicing this sector. These are considerations we shouldn’t need to consider.

We agree with many commentators that, in the past, tourism failed to do its bit in terms of taking into account the impact it had on our communities and environment. It needed to do better for the social and environmental good of New Zealand when we had 3.8 million international visitors. But we believe lessons have been learnt, and by now, almost every region has a Destination Management Plan (DMP). Let’s not waste the learnings and the millions of dollars invested in developing the DMP’s.

It’s great the government has released a plan for re-engaging New Zealand with the rest of the world, but at present, there appears no realistic plan for re-engaging the economic and social benefits of international tourism. There is no plan to fill the massive financial gap that international tourism filled. Domestic tourism will never replace that value, and as borders open, the spending that occurs from the domestic tourist is bound to be lost (or leak out) as New Zealanders travel to other international markets.

Many tourism businesses have closed, in hibernation or running with little oxygen left in their tanks. New Zealand needs these businesses to help grow our economic base and reduce the burden of repaying COVID-related debt on the resident population. New Zealand needs to have a fantastic product offering when international tourism returns. However, if our product offering is minimal or rundown, we risk offering a sub-standard experience and having fewer repeat visitors, high-value or not – which slows our economic recovery.

The world of tourism has changed. However, New Zealand is recognised as a premium destination, and there is reported pent-up travel demand for such destinations, so let's use that to our advantage. Promoting premium status and, for example, visitors needing to book to participate in activities before they get here enables us to deliver on the promise of 100% Pure. Pure in the sense of the overall product and experience. As we grow back to 3.8 million visitors, we can progress discussions on where, as a country, we want to go in terms of tourism numbers. However, our first goal needs to be urgently getting back those international visitors – and their money!

Not many businesses or country success stories worked using the strategy of ‘shrinking their way to success’; therefore, possibly fewer tourists (that is, shrinking our tourism industry), with no guarantee of them being high-value, or will lead us to success, is a high-risk strategy.

Yes, our target plan is ambitious, but we know we can cope with the number – we've done it before. We may not get the 2019 numbers back by 2023, perhaps it will be 2024, but it’s a damn good target, and it gives everyone hope. Indeed, we must get them back as we have such a large financial hole to fill. In the meantime, we have world-class hotels, convention centres, sports facilities, airports, and a unique environmental product to share, but more importantly, to maintain going forward.

When should our recovery target be aggressively activated? Now! The longer we wait, the greater the cost to our present taxpayers and society.

Tourism New Zealand must be directed to market us urgently and aggressively to the world, and while they do that, we must continue to positively focus on the environment, as we are presently doing with, for example, developments of fuel-efficient, renewable energy powered planes, business sustainability programmes, etc. We are rapidly and successfully fighting COVID variants, just as we did many years ago for SARS. Tourism may be down, but it is not out, and we must get international tourists back – urgently.

It’s time to agree on a recovery target and start moving. We are a desired destination; let us maximise this as revenge-travelers abound. Let’s be a leader in sustainable tourism recovery.

We reiterate that failing to plan is planning to fail, and as we don’t see a do-able strategic plan, we are looking at failure. Is that really what New Zealanders want to be part of?

In our subsequent commentary, we will explain in detail why New Zealand needs to consider our recovery target plan seriously, the social, environmental, and economic reasons. In the meantime, we assume our recovery target plan will have created debate and, for some – hope. In either case, that’s a good thing.

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