- Visitor spending surges 38 percent to a record NZ$9.4 billion
- Chinese tourist arrivals help buffer dip in milk powder demand
In New Zealand, where cows outnumber people, leaping off a bridge tethered only by a rubber band has better economic prospects than selling milk.
The nation that first commercialized bungee jumping is counting on visitors to sustain growth after dairy exports slumped. Tourism this year might account for as much as half of New Zealand’s economic expansion, said Shamubeel Eaqub, an independent economist in Auckland.
“We’re starting to see a broad-based recovery in tourism and serious dollars coming into the New Zealand economy,” Eaqub said. “If we didn’t have that, then economic growth would be a lot lower.”
Growth will almost halve to 1.8 percent this year as falling milk prices hurt farm incomes and domestic confidence, New Zealand’s central bank forecast in September. Now, with the local dollar hovering just above a six-year low, travelers are flocking. Visitor spending jumped 38 percent to a record NZ$9.4 billion ($6.3 billion) in the year through September, the government reported last week.
With airlines opening new routes from the U.S. and Asia and the visitor influx outpacing government forecasts, tourism is starting to rival dairy as the nation’s biggest foreign-exchange earner.
New Zealand generated NZ$11.8 billion in revenue from international tourists and foreign students in the 12 months ended March 31, nearing the NZ$14.2 billion the country received for its dairy exports, according to a report released in October.
The gap may narrow with an influx of Chinese tourists helping to counter a plunge in Chinese demand for milk powder. Travelers from China spent NZ$1.55 billion in the 12 months ended Sept. 30, a 78 percent increase from a year earlier, government data show. Chinese visitor numbers are predicted to reach 600,000 by 2021, more than double the 265,000 last year.
The South Pacific nation, whose alpine scenery was showcased by the “Lord of the Rings” and “The Hobbit” movies, is reaping the benefits of marketing itself as a thrill-seekers’ paradise, said Chris Roberts, chief executive of the Tourism Industry Association.
It opened the world’s first commercial bungee-jumping business in 1988, offering a 43-meter plunge off the Kawarau Bridge, near the South Island tourism mecca of Queenstown. Dare-devils can now spring from bridges and platforms around the country attached to a large rubber band, including a 192-meter (630-foot) plummet from Auckland’s Sky Tower.
New Zealand also lays claim to commercializing jet-boat rides, with the first business opening on the Kawarau River in 1960. Today, the hair-raising boat trips draw tourists across the nation, from Queenstown’s rivers in the south to Auckland harbor in the north.
‘Eating a Bagel’
“If you go to New Zealand, you have to have gone on a jet-boat or bungee jumped or zip-lined,” Roberts said in an interview. “How could you go to New Zealand and not do those things? It would be like going to New York and not eating a bagel.”
More than half of the international visitors coming to New Zealand for a holiday undertake at least one adventure activity, government figures show. Tourists seeking adventure typically stay longer and on average spend 17 percent more than those who don’t, according to the data.
Visitor spending languished during the past decade as global confidence waned and the Kiwi dollar surged, making travel to New Zealand more expensive. The currency’s 15 percent decline the past year and the emergence of China as the second-biggest market for incoming tourists after Australia has underpinned the recent turnaround.
U.S. tourists are the third-biggest spenders, with purchases climbing 55 percent to NZ$1.04 billion in the 12 months ended Sept. 30. Spending by visitors from the U.K. jumped 43 percent to NZ$1.03 billion.
By the end of January, there will be five direct routes from China to New Zealand, increasing airline capacity to 10,699 seats per week. Air China begins a daily Beijing-to-Auckland service on Dec. 10 and China Southern Airlines starts flying between Christchurch and Guangzhou the following week. Air New Zealand will provide a direct Auckland-to-Houston link from Dec. 15 while United Airlines plans to fly from San Francisco next year.
The new Chinese visitors are independent travelers rather than arriving on group tours, and are younger people who are quite prepared to be adventurous, said Roberts.
Thrills v. Spills
The challenge is to keep them safe, with fatal accidents, such as a helicopter crash on Fox Glacier last month, highlighting the risks of adventure tourism.
“People come to this country to see its natural wonders and the adventure element is absolutely fundamental to people’s experience,” said Stephen Espiner, senior lecturer in parks, reserves and tourism at Lincoln University near Christchurch. “But no one goes heli-hiking under any realistic expectation they might not make it back.”
The death of a British tourist in 2008, while riding a body board on rapids near Queenstown, was the catalyst for a shake-up and tightening of regulations in New Zealand’s adventure tourism industry.
The key is to get the right balance between risk and safety, said Simon Milne, professor of tourism at Auckland University of Technology and director of the New Zealand Tourism Research Institute.
“It wouldn’t be an adventure unless there was some risk involved,” he said.