New Zealand’s tourism industry is doing so well that the country is struggling to cope with the numbers of arrivals and is mulling a tax on tourists to fund new infrastructure.
More than 3.4 million visitors arrived over the past year and a booming summer season is due to set a new record. The population of New Zealand is just 4.74 million, so the number of tourists over the past year was equal to over 70% of the New Zealand population. For comparison, the number of tourists visiting Australia over the past year was roughly 35% of the Australian population – spread over a much wider area.
Total annual tourism revenue in New Zealand has grown from NZD 28 billion to NZD 34.7 billion in just two years.
“However,” Tourism Industry Aotearoa chief executive, Chris Roberts concedes, “we know and acknowledge that there is rising public and industry concern that tourism is growing faster than our ability to cope.”
Tourism Industry Aotearoa (TIA) is the only independent, private sector organisation representing all sectors of New Zealand’s large and diverse tourism industry. Aotearoa is the Maori word for New Zealand.
“Without a coordinated response from industry and central and local government, we risk being unable to fully capture the future potential of tourism and protect the long-term sustainability of our industry,” Roberts admits.
A New Zealand Herald report mentioned problems caused by tourism: summer traffic jams around Auckland Airport are infuriating residents; tourists have fouled trails on the Coromandel peninsula southeast of Auckland. Additionally, tourists, sometimes driving on the wrong side of the road or simply driving dreadfully, have been implicated in a spate of motor accidents.
As a result, 19% of New Zealanders, almost one in five, say they are worried about the impact of too many visitors.
Formerly, New Zealand’s Tourism Minister was Prime Minister John Key. With the recent resignation of Key, the country’s new Tourism Minister is Deputy Prime Minister Paula Bennett.
Bennett may be the one who decides whether to impose new taxes on tourists to fund needed infrastructure.
A group of tourism leaders is pressing for the New Zealand Government to create a National Tourism Infrastructure Levy, comprising a 2% national bed levy across the accommodation sector and a NZD 5 increase to the “border levy” (departure tax) which would raise NZD 65 million a year from the industry. That’s the conclusion of a report commissioned by the chief executives of Air New Zealand, Auckland Airport, Christchurch Airport and Tourism Holdings.
Matching funds from the government would bring this to NZD 130 million annually to fund local tourism infrastructure needs.
Charging more for overseas visitors to use national parks is another concept under discussion.
As New Zealand examines tourism, the honesty of the country’s famous and award-winning 100% Pure New Zealand promotion has also been called into question.
Just how pure is New Zealand? According to Water Action Initiative New Zealand (WAI), a grassroots, not-for-profit organisation, 43% of monitored lakes in New Zealand are now classed as polluted and groundwater nitrate levels are rising with 39% of monitored sites nationally showing increases. Human health is affected, with an estimated 18,000 to 34,000 people annually contracting waterborne diseases, WAI states.
Despite that, spending by international tourists is roaring ahead, having grown by almost 20% in 2016 on the previous year. Domestic tourism spending grew by 7.4% giving the sector a NZD 3.8 billion increase on 2015. Tourism accounted for 5.6% of GDP with a direct contribution of NZD 12.9 billion while directly employing 188,136 people – 7.5% of the total number of people employed in New Zealand.
Christchurch International Airport chief executive Malcolm Johns says that as New Zealand’s tourism industry grows “it’s important that local public infrastructure keeps pace but we also need to be realistic about the ability of some local communities to fund the ongoing investment required.
“Rapid tourism growth over recent years means there’s already a local tourism infrastructure deficit in parts of New Zealand, especially in regions with low numbers of rate-paying residents and high visitor numbers.”
Auckland Airport chief executive Adrian Littlewood says that while the industry “is in good heart and adjusting to growth, it is the right time to be focused on not only recovering that deficit but positioning New Zealand to get ahead of the game and sustain the growth into the future”.
Written by Peter Needham