What lies ahead: Tourism

Can the tourism industry continue its dream run in 2005? If the optimistic statements of key players are anything to go by, then yes.

Those members of the country's most lucrative industry say it is set to get bigger as international tourist numbers increase and those visitors spend more on their trips here.

Auckland International Airport chairman Wayne Boyd told shareholders at the company's annual meeting in November that the country's largest airport expected tourist arrivals to grow 5.8 per cent a year until 2010.

That sort of growth is driving a $375 million investment programme at the airport and, Boyd said, would make a net profit for the year to June 2005 of $105 million "achievable".

Keith Smith, the head of NZX-listed Tourism Holdings, also expects solid growth as THL takes over a significant ferry operation in the Bay of Islands and invests heavily in revamping attractions such as Kelly Tarlton's aquarium.

"There are no indications we can see that suggest New Zealand's bubble as a hot tourist destination is going to burst," Smith told shareholders at THL's annual meeting in November.

Figures proudly quoted by Smith certainly paint an attractive picture:

* Tourism is the number one contributor to the economy as measured by the gross domestic product at 7.6 per cent.

* And the number one employer at 10 per cent.

* Its annual $7.4 billion export earnings make it the top exporter, beating the dairy industry.

Although tourism has been able to catch a ride on the coat-tails of the Lord of the Rings trilogy, a strong dollar means tourists get slightly less for their money here and may look to cheaper destinations for getaways.

A fly in the ointment is a skills shortage that if left unchecked could limit the growth of attractions, tour activities and the services sector.