As you probably picked up from Prime Minister Christopher Luxon’s State of the Nation speech on Thursday, 2025 is apparently all about financial growth and saying ‘yes’. Those are two trends I am trying to adopt in our house for 2025 as well, especially saying ‘yes’ when I ask someone to do something...
I digress, back to the nation.
Before COVID-19, tourism was New Zealand's largest export industry, so it’s clear why the Prime Minister and his newly minted Economic Growth Minister Nicola Willis have identified it as a priority area for the country to earn more.
Data released in January reveals that in the year ending November 2024, visitor numbers increased to 3.26 million, an increase of 360,000 from the previous year, and 86 percent of pre-pandemic levels.
So, the numbers are going in the right direction, but international tourism still remains our second highest export. There is more work to do!
New Tourism and Hospitality Minister Louise Upston is the fifth minister to hold the portfolio in five years - so some stability in the portfolio is a good place to start.
Nicola Willis has suggested the new Minister will look at how funding is currently being used, the visa processing system, and marketing campaigns. All good places to start - although you’d have hoped this happened when the coalition came to power over a year ago.
The Minister will also be looking at how funding from the international visitor levy is being spent, after the levy increased from $35 to $100 in October last year.
Increasing levies, adding user charges and targeted taxes on visitors has been recommended by MBIE in the past as a way to fund tourism - and we have seen DOC increase hut and campsite fees and the trialling of car parking charges at Punakaiki, Franz Josef Glacier, and Aoraki Mount Cook.
But what about the visitor bed tax? Perhaps a crude idea in 2020 when hotels were empty; but with the industry recovering - is it time to resurrect the idea? Auckland Council has long advocated to central Government that some form of bed night levy or tax is required to support funding major events, destination marketing and visitor attractions. If one is not implemented by the middle of this year, there will be a budget gap to fund major events.
The Government is not buying into the idea that tourism needs infrastructure support. In their view, if regions get more tourists then they can deal with it themselves.
When it comes to one of our busiest tourist spots, the Government is very quick to point out that Queenstown is getting a $250 million roading upgrade.
But that’s not enough. As Queenstown mayor Glyn Lewers told me on Early Edition this week - “I’d welcome more tourists if there is a proviso that the infrastructure to support and accommodate more tourists and visitors is accounted for”. He pointed out Queenstown’s airport needs to be better staffed with more customs and security staff to function well as an international airport.
We all want growth and a thriving tourism industry. But we also want it to be sustainable - avoiding the degradation and overcrowding of our wilderness, pressure on infrastructure, and communities carrying the cost.
So, if the Government wants growth - and tourism back in the number 1 export earner spot - it should perhaps consider putting in a little bit more so it can get more out.
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