Double whammy clouds outlook for tourism

The Ministry of Tourism has slashed visitor growth expectations in the wake of the global financial crisis and swine flu.

Last year the ministry predicted average growth of 4 per cent a year for the next seven years.

But now that has shrunk to just 2.5 per cent a year with 2009 predicted to be the toughest for the $20 billion industry in recent history with a drop of 4.2 per cent.

Ministry of Tourism head of research Bruce Bassett said the industry had been hit hard by the global economic downturn.

He said the downturn in New Zealand had been been accentuated by the swine flu.

"If it was purely the economic downturn it would be considerably less than it has been."

But despite this year's fall, Bassett said there was a strong belief growth could return next year. "We think that, the assumption being the global economy starts to recover next year and there is likely to be some pent-up demand for travel ... 2.5 per cent is pretty modest - it's not a big move."

But industry leaders said even that was going to be tough.

"I don't think that 2.5 per cent in any climate is going to be easy," Tourism Industry Association chief executive Tim Cossar said.

Inbound Tour Operators Council chief executive Paul Yeo said returning to 2.5 per cent growth next year was going to be a challenge. "It's almost fingers crossed the Australian economy goes as well as it is."

VISITOR FORECASTS
* A drop of 4.2 per cent this year before recovering to 2.5 per cent growth in 2010.
* A spike in growth of 6.5 per cent during the Rugby World Cup in 2011.
* Lower growth of 2.5 per cent in 2012 before returning to lower average growth of 3.4 to 3.6 per cent.
* Visitor numbers up 18.6 per cent by 2015.