International tourismNew Zealand

International visitors return a slow burn

Return to pre-COVID figures not expected until May 2026

The Tourism Export Council of New Zealand (TECNZ), foresees a return to pre-COVID numbers will take a long time.

In a statement, TECNZ said while thrilled that international visitors from Australia can return to New Zealand from 12 April 2022, it sees an anticipated quick uptake for the VFR market and Australian snow traffic which is good for those NZ businesses that service the ski market.

But there is still a long way to go before traditional (long-haul) international tourism visitors return to the country and the organisation expects to see bookings flatten for a few months until October 2022 when the long-haul market reboots.

TECNZ said although the news is encouraging, and businesses can now plan with more certainty, the return of visitor numbers will be a slow burn.

TECNZ forecasts the return of visitor numbers will be approximately 56.2 percent of pre-COVID arrivals by year-ending May 2023, increasing to 70.4 percent by year-end May 2024, and to around 83.4 percent by year-end 2025.

By year-end May 2026 figures should be back to pre-COVID visitor arrivals of 3.9 million.

The statement went on to say that international tourism businesses have been the most impacted of all sectors across society.

Having no access to main customer bases for two years, pivoting to domestic but having a handbrake on with lockdowns in 2020, then Delta in 2021 and now Omicron in 2022, many iconic tourism businesses, large and small, have been crushed.

The immense stress and anxiety business owners have been under cannot be understated. The combination of border closure and pandemic has taken its toll, financially, socially, and emotionally.

A major concern TECNZ has is the survivability factor for international tourism businesses to get to the starting gate in October 2022.

Because of the lag time, businesses still need targeted financial support, they are hanging on by a thread and they’ve exhausted all balance sheet reserves and life savings, got second mortgages, borrowed from family and friends, and sold assets to stay alive.

Most international businesses are not eligible for the recent COVID Support Payment (CSP) because they are unable to demonstrate 40 percent loss in 2022 against 2021, when in 2021 they were only trading at zero or only 20 percent.

TECNZ says it will take time for cash-flow to grow and it is hopeful Tourism Minister, Stuart Nash and Cabinet will revisit any decisions on targeted support shortly which is needed to ensure the quality world-class visitor offering, infrastructure and service is still around for when visitors start to return.

If airlines and New Zealand’s offshore travel partners can start to sell the destination for the upcoming 2022-2023 season, if the country can receive a good number of Australian visitors through the winter and spring period, and businesses can get targeted financial support, the industry may finally be able to face the future with a small degree of confidence.

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