Summer surge tipped for NZ tourism

Hikers at a rest stop on a guided hike around Lake Waikaremoana. Photo / Amos Chapple

Researchers at Westpac have painted a bright future for the tourism sector.

They say that after being in the doldrums for most of the last 10 years, the tourism sector was expected to go through a cyclical upturn over the remainder of this year and through the next.

At the same time, the structural lift in Chinese visitor arrivals will continue to shape the industry, they say in a report entitled "Sleeping beauty is awake".

The upturn will come as Christchurch re-opens for business and the "fear factor" from the earthquakes continues to subside. Also, we expect the US market will build on recent improvements while the British and German markets will continue to stabilise.

"On the flipside, growth in the Australian market may weaken as Australian economic growth eases and the New Zealand dollar rises against its Australian counterpart," the researchers say.

There was a "powerful trend" in the increase in arrivals from China, the fastest growing market for New Zealand. Arrivals from China increased by nearly 50,000 during the past year to 223,000.

"Airline capacity and other factors permitting, we expect a similar increase over the year ahead."

Since 2002, the sector's share of GDP and employment have both fallen due to declines in the Japanese, British and and Korean tourist markets. Arrivals from Japan stagnated in 1996 as its economy sagged About 75,000 Japanese arrived during the past year - half the 2004 level.

The high New Zealand dollar has also been a drag on the sector, although the strength of the Australian dollar at the same time meant they were not deterred from coming here.

Australia is our biggest market with almost 1.2 million arrivals.