Visitor arrivals dropped sharply in March, according to Statistics New Zealand figures released yesterday, and an economist says the situation facing tourism operators will deteriorate before any improvement is seen.

Arrivals fell 11 per cent to 215,600, compared to March 2010, resulting in part from the disasters in Christchurch and Japan.

Goldman Sachs economist Philip Borkin said April and May would see further weakness in arrivals, with the situation likely to improve in the third quarter of 2011.

"Q3 coincides with the Rugby World Cup but naturally - even if we didn't have the Rugby World Cup - we'd have arrivals start to rebound around there," he said. "When you look at natural disasters around the world and the impact they have on the tourism sector, typically it's quite short and sharp. You see arrivals fall in the few months after the event and then rebound quite quickly."

Australian visitor arrivals were down 11,900, with 3700 fewer from Japan and 6800 less from Britain.

Conversely, Chinese visitors were up 700, while those from Singapore and the United States increased by 200.

Tourism New Zealand chief executive Kevin Bowler said the March numbers were disappointing, but not unexpected.

"I think we're likely to experience another couple of months of quite weak demand, largely as a result of the earthquake in Christchurch," he said.

Bowler said New Zealand's tourism industry had been finding the going tough even before the February 22 disaster.

"Whilst visitor numbers were up the visitor spend was down so overall it's going to be quite tough for operators over the next two or three months," he said.

Bowler said Tourism New Zealand was increasing its marketing investment for this country's ski industry in Australia. "If all goes well we should see things returning to normal as the ski season kicks in."

Rising visitor arrivals from China and the US were a positive sign, Bowler added.

Air New Zealand deputy chief executive Norm Thompson said the airline was working to turn around the decrease in Japanese arrivals.

"I don't think [the fall in visitor numbers] is a sustained situation at all," he said.

Statistics New Zealand said arrivals from Australia and Britain had been affected by the timing of school holidays, and the seasonally adjusted decrease for March was 8 per cent.

Annual visitor arrivals for the year to March 2011 were $2.5 million, a 1 per cent increase on the prior comparable period.

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