New directions are needed for the Central Otago economy as it looks to recover from Covid-19, writes Wanaka resident Warwick Thompson.
Central Otago has squandered opportunities to diversify its economy and reduce its reliance on international tourism.
Queenstown Mayor Jim Boult and Wanaka Community Board chairman Barry Bruce have now renewed calls to create new businesses to fill the huge economic gap left by vanished inbound tourists.
With the International Air Transport Association saying international travel is unlikely to be fully restored until late 2023 at earliest, that gap will be with us for years.
We are fortunate to live in one of the world's most attractive topographic environments and with a benign climate. Our geographic isolation has proven its advantages during Covid-19 and in the past two decades modern communications have progressively eliminated its disadvantages. We have clean, clear air, clean oceans, and mostly clean water in our lakes and rivers.
We have squandered this island paradise in the pursuit of mass tourism that has then grossly used it, abused it, and now vanished.
Airlines, airports, hotel chains, and rental vehicle companies — all whose business success is driven by more bums on seats, more bodies in beds, and more planes filled with people passing through their airports — flooded the country with ever-increasing mass tourism. Those industry participants have borne no cost for the national and environmental consequences of their successful business strategies.
Instead, our communities and ratepayers have struggled to provide and pay for the infrastructure and services required to sustain it all, often disproportionately.
In Central Otago, we have had to fund this for a transient population that at times has been up to 35 times greater per day than the resident community that finances it. And all while despoiling the very environment that attracted them — and us — here in the first place.
Mass tourism has distorted the Central Otago economy to the extent — as quoted by Mr Boult — that some 90 per cent of Queenstown businesses pre-Covid-19 were dependent upon tourism in one way or another. It has led to a huge regional construction boom that has swallowed up and scarred scarce land that has been part of our iconic landscapes. Thousands of temporary workers, paid low wages to wait tables, make beds and clean vehicles, have struggled to live, feed and house themselves in a high-cost environment in order to service the mass tourism industry.
As a Wanaka community leader Quentin Smith has commented for years, our high-volume inbound tourism industry was not sustainable. It never is and never would be.
Mass tourism is capricious. It can be decimated almost overnight by economic crises, the policies of nations' governments, and as we have seen so recently, pandemics. Tourist locations are ''fashionable'' and prone to change. To build a local economy based upon it was always going to end in tears.
During my years working internationally, I saw many examples of the frailty and fickleness of large-scale international tourism. Hawaii was devastated when the Japanese economy suffered and stagnated in the new millennium.
Dubai almost became a ghost city in the GFC. Thousands of cars were left abandoned on streets and in car parks as unemployed expatriates and foreign workers servicing tourists all fled for their homelands.
Closer to home, Cairns in Queensland suffered when tourists discovered Bali and Phuket and the 15 airlines using the new Cairns airport suddenly became only three. Hotels and motels in resorts such as Palm Cove and Port Douglas were deserted with shuttered windows and weeds in the forecourts.
During the Covid-19 lockdown when our borders closed and inbound tourists vanished, calls erupted throughout New Zealand that we now had the opportunity to re-base our future inbound tourism industry, and not go back to where we were.
• Where we were included:
• A constant line of day-trampers jostling nose to tail on the famed Tongariro Crossing.
• Highways congested with convoys of camper vans or 20-seat buses with trailers attached.
• The picturesque Church of the Good Shepherd at Tekapo closed and inundated with visitors.
• The round boulders of Moeraki defaced with graffiti.
• A 40-minute wait in line for a selfie at the top of Wanaka's Mt Roy.
• Freedom-campers washing their clothes and dishes in our pristine lakes and rivers and littering our stopping-places with faeces and toilet paper.
Overcrowding at popular scenic spots was such that even tourists were complaining there were "too many tourists".
Do we really want to go back there, or to see even worse excesses than those develop?
If not, what initiatives can we take and what can we do to replace the 15 per cent - 25 per cent of our economy that has been lost?
Recently I received an invitation to attend a ''Start-up'' hui to encourage and educate entrepreneurs thinking of starting their own business. There have been a number of these courses and various other similar initiatives undertaken and promoted across the region in the past five years or earlier. I have participated in assisting several of them.
Laudatory and well-intentioned as they have been, they have had little measurable impact on diversifying our economy away from inbound tourism and of sufficient extent to replace the hole it has left.
Instead, to make a significant difference, I suggest we need to pursue new strategies. Two come to mind, but the many clever people in the region will surely suggest more and better.
First up, we should leverage our environment to advantage.
Central Otago is one of the world's few unique places to live. Prominent and wealthy foreigners have demonstrated that by acquiring land and building homes and lodges here. It is a very desirable environment in which to live, to work, and to establish specialised businesses.
We have a modern, developed economy. We have stable Government, a parliamentary democracy, developed infrastructure, a strong legal framework, no corruption, an educated workforce, strong international connections and logistics, and a range of business-friendly incentives.
To leverage that, councils should set up and pursue an outreach programme.
Led by a suitably qualified person, a small team should be established to reach out internationally and attract offshore companies to locate and/or establish some of their activity in our region.
An outreach team can construct an attractive package promoting the extensive benefits of basing new business activity, or part of an established one, in our region.
Working with Mfat, expatriate Kiwis in positions of influence in businesses around the world, political friends of New Zealand, contacts of prominent foreigners resident among us, companies, businesses and operations can be identified and approached.
Attracting whole new business activities to our region will rapidly diversify the economy, uplift average incomes, provide training, highly skilled employment and new career opportunities.
Outreach programmes have been used elsewhere successfully for many years. Countries and cities have done it. Singapore as a nation transformed its economy in part by pursuing such a strategy. The state of Tennessee in the US did it. In Australia, the state of Victoria had such a programme running for years, attracting business to Geelong.
Already, while this article was being written, Prime Minister Jacinda Ardern announced Microsoft will move an activity to New Zealand — how about to Queenstown?
Such companies are often looking for stable, safe locations for their business and environments that promote innovative and creative atmospheres for their employees to work on the products and ideas of the future in. IT companies, drug and other research labs, engineering design and robotics all fit in this mould.
To encourage highly-skilled, qualified and experienced expatriates to transfer to our region, the outreach programme can be augmented by HR support, with materials that help such new residents understand and live in our community.
It should be possible to provide a design-and-build service as part of the package to attract offshore businesses. Working with Remarkables Park's Alastair Porter and Wanaka's Three Parks Allan Dippie, a business park could grow to accommodate business transferring to the region. The council could guarantee the attractee's rental for a period. The client's design/build could be onsold to investors.
Next up, we should harness the diversity of professions and skills already among us.
Our communities are fortunate to host a wealth of skilled and professional second-level health and wellness practitioners. Most of them work as individuals or small groups disparate and largely unco-ordinated with each other.
By combining their collective skills into a range of structured programmes, a new "health and wellness" industry can be created.
Such an industry can attract the wealthy, the tired, the ageing, celebrities, the rich and prominent people from the world's entertainment sector, all looking for a safe and attractive place to chill out, rehabilitate, and do some "repairs and maintenance". Such places exist, particularly in Europe and the US. Germany alone has many.
We are fortunate to have high-quality audiologists, podiatrists, optometrists, specialist physiotherapists, beauticians, skin specialists, meditation specialists, cosmeticians, fashion hairdressers, and numerous other specialised practitioners, in addition to the qualified medical profession. We even have a manufacturer of certified-biodynamic cosmetics. All have the capacity to participate in and contribute to such programmes.
Our region has a plethora of luxury lodges as a hideaway for the rich and famous to "R and R" while enjoying the variety and splendour of the environment. These lodges can be incorporated to provide accommodation and the base from which the health and wellness programmes can be offered, drawing in the relevant skills and professionals that each of the various programmes requires.
It could also be possible to include cosmetic and corrective surgery into such programmes, utilising the new Southern Cross hospital being built in Queenstown's Remarkables Park.
All that is required to build such an "industry" are some key individuals with the vision and drive to co-ordinate all the practitioners and the lodges, create the various programmes, and then actively market them to the world.
The people, the skills and the resources to achieve this already exist among us.
These are just two initiatives that could transform the economy of the Central Lakes district, create wealth and opportunities in our communities, and provide sustainability.
There must be others. There need to be others.
Warwick Thompson has lived in Wanaka since 2001. He previously worked in executive international management roles in Asia, North America and Europe.