Tourism roars past dairy as NZ's biggest export earner

New Zealand's tourism industry is riding high. Photo / Supplied

New Zealand's tourism boom has propelled the industry past dairy as the top export earner as the number of visitors increased by one million in the past six years.

For the year ending December last year total exports of dairy and related products were $12.05 billion, accounting for 17.2 per cent of all exports. Over the same period, tourism (including air travel) was worth $12.17b or 17.4 per cent of exports, according to analysis by the ASB.

These compare to 18.2 per cent and 16.9 per cent respectively for 2015,

The next largest export is meat, all the way back on 8.4 per cent of total exports, leaving tourism and dairy well out in front.

In the year to February, a total of 3,544,219 short-term visitors arrived in New Zealand. That includes people travelling for tourism, visiting family, business trips and other reasons.

ASB economist Daniel Snowden said the rapid increase in visitors has put some pressure on resources, leading to price increases.

"This has, in turn, led to some anecdotal evidence that some visitors are starting to turn their attention to alternative destinations, although there has been little empirical evidence so far."

As the number of short-term visitor arrivals has expanded, so has total spending. In 1997 total visitor spending was $3.85b, according to the International Visitor Spending survey. By the end of 2016 that had almost trebled to $10.09b.

The ASB said total spending did not rise in a smooth line, with a growth period between 1997 and late 2001, when it was around $7b. It then held in a $7b to $8b range until 2014, when the current sharp boom started.

The most recent boom would be attributed to the growth of the middle class in China (the second biggest source of visitors) both in terms of number and wealth.

It is also easier and cheaper to get to NZ now, with extensive growth in the number of airlines flying to NZ and the routes that have opened.

"The impact of The Lord of the Rings and Hobbit films in showcasing NZ cannot be underestimated."

Events such as the 2011 Rugby World Cup and 2015 Cricket World Cup boosted arrivals significantly.

Snowden said the World Masters Games now on could boost Auckland's economy by $30m and the British and Irish Lions tour this winter is forecast to inject $240m into the national economy.

"Overall, the New Zealand tourism sector is in rude health," Snowden said. "Demand is strong but the main short-term challenge is for the infrastructure to meet demand."