Tourism crucial to GDP

By Brian Fallow

WELLINGTON - Tourism supports 118,000 jobs, provides 15 per cent of export income, and is second only to agriculture in its contribution to gross domestic product.

These are among the findings of the first Tourism Satellite Account, a Statistics New Zealand pilot project to produce an official and internationally comparable measure of tourism's role in the economy.

It defines tourism widely to include not only international visitors, but also New Zealanders travelling within New Zealand but outside their "usual environment", whether for recreation or on business.

Using 1995 data, Statistics NZ put total tourism spending at $9.1 billion, of which international travellers accounted for $4.3 billion and domestic tourism the rest.

The money went to:

* Direct tourism GDP of $2.9 billion (3.34 per cent of total GDP).

* Indirect tourism GDP (another $4 billion).

* Imports used in production of goods and services consumed by tourists ($1.3 billion).

* GST ($850 million).

To illustrate the distinction between direct and indirect contributions, Statistics New Zealand said when a tourist bought a meal in a restaurant the cost of the meal was direct demand, while producing the meat and vegetables and the electricity used to cook it and so on was indirect.

Of tourism's $2.9 billion direct contribution to GDP, wages and salaries took $1.38 billion, spread over 58,000 "full-time equivalent" employees. Indirectly tourism supported another 60,000 jobs.

Operating profits accounted for $1.08 billion, depreciation $366 million and indirect taxes $109 million.

The $4.3 billion spent by international visitors represented 15.8 per cent of total export earnings, more than any other single export category.

Tourism Minister Lockwood Smith said funding had been allocated in the coming fiscal year for Statistics New Zealand to repeat the exercise, this time in real time.