Keep some tourism funding in NZ - Snedden

Hobbit campaigner Tourism NZ welcomed John Key's targeting of high-value visitors. Photo / Christine Cornege

Industry boss wants some of windfall likely to be aimed at overseas promotion spent in NZ.

The Government's $158 million boost for promoting tourism has been welcomed by the industry, although one leader says some of it should stay in this country to get the sector's foundations right.

Prime Minister John Key announced the four-year package - on top of about $85 million a year which already goes to Tourism New Zealand - in a pre-budget event yesterday. He will unveil details at an industry conference at the weekend, and most is likely to go to Tourism NZ for promotion in overseas markets as the country struggles to reach the consistently high visitor growth rate it enjoyed before the global financial crisis (GFC).

Although tourism operators report a strong summer, Government figures for last year sagged to levels seen more than a decade ago and Visa card figures out today show visitors spent 8.5 per cent less on the plastic than in 2011.

Both sets of data show spending by Chinese tourists is rapidly growing as other traditional markets, particularly Britain, languish.

Key, also Tourism Minister, said recent visits to China and Latin America had demonstrated there was "huge potential" in these and other growth markets.

He said funding would speed up work already under way in attracting high-value tourists, and expanding existing markets.

Some would be used to bring international events here and spent on continuing work to simplify visa processes.

These are likely to include Indonesia and India and with the possibility of direct air links to points within Latin America, extra effort could go into that region.

The United States' west coast - a strong traditional market that is recovering after the GFC - is also likely to get a marketing push.

Tourism Industry Association chief executive Martin Snedden said the announcement was welcome and targeted promotion of the country in key markets was a good idea.

However, some of the funding should be set aside to help the "supply side" of the industry, with priority to finding out what was happening on the ground.

"We accept that a significant amount [of] that is going to go into Tourism New Zealand but if there's a slice of it that could go into this tourism intelligence area I think that in the long run that would pay off," Snedden said.

"In addition to our marketing what we need to ensure is that we have the strongest possible foundations on the ground."

Snedden said the push in emerging countries should not ignore traditional markets such as Britain which will eventually bounce back.

Tourism NZ, behind the 100 per cent Pure and Hobbit campaigns, said the funding package had a deliberate focus on attracting high-value visitors, something which was strongly supported during industry consultation on its new strategy.

There is wide concern that too many Chinese visitors are on short, tightly controlled shopping trips returning little revenue for New Zealand tourism operators and a big part of the industry's effort is to attract higher-spending free and independent travellers.

Air New Zealand's chief executive Christopher Luxon said the $158 million was a significant investment in growing tourism export earnings to New Zealand, which would boost jobs and visitor spending throughout the country.

High stakes

* Total tourism spending is worth $23b a year.
* Tourism contributes almost 9 per cent of GDP.
* International tourism worth $1.3b in GST.