The number of tourists coming into the country rose by close to one million over the past year but is still running at 17 per cent down on pre-pandemic levels.
The tourism sector, once the country’s biggest export earner, has been boosted in the past year by a surge in the number of arrivals from China.
In the year to March, there were 3.18 million visitor arrivals, up by 984,000 on the corresponding period in 2023 but still well short of the 3.87 million who came to Aotearoa in the year to March 2019.
The pandemic hit in early 2020, borders shut, and many in the international tourism sector switched to catering to domestic tourists.
While the number of overseas tourists has been about 80 per cent of pre-pandemic levels for most of the past summer, Kiwibank is forecasting a further recovery, especially if the China market continues its strong recovery.
The figures released today by Stats NZ show arrivals from China were up 144 per cent in the past 12 months - from a low base of 34,000, to 211,000.
United States arrivals soared by 149,000 to 376,000 during the past year, reflecting the large increase in airline capacity between the US and New Zealand.
Australia remains by far the country’s biggest market at 1.29 million (up 149,000 in the last 12 months) and India is up strongly from 51,000 to 88,000.
Arrivals from South Korea are up 41,000 to 70,000 and the number of visitors from Japan has increased 34,000 to 60,000.
The number of arrivals for March was 340,300, up 74,200 from the same month a year ago. That was 90 per cent of the pre-Covid-19 number.
Stats NZ said March 2024 visitor numbers were likely boosted by the timing of the Easter holiday, which was in late March in 2024 and in early April in 2023.
New Zealand-resident traveller arrivals - Kiwis taking holidays overseas - were 2.84 million in the latest March year, increasing by one million from the March 2023 year.
Kiwibank says the international tourist market could recover this year, but it was largely dependent on the return of Chinese visitors.
Kiwibank economist Mary Jo Vergara says last year’s slow recovery in international tourism was a drag on the economy towards the end of 2023.
In the year to March last year, tourism’s contribution improved to 11 per cent of total exports, just 60 per cent of pre-pandemic levels.
She said the outlook was bumpy.
Financial conditions are tight and unemployment across the globe is slowly rising.
This may temper demand for expensive, long-haul travel.
A mitigating factor, however, is the bank’s expected depreciation of the Kiwi dollar.
“We expect the Kiwi economy to be weaker relative to our trading partners. A weaker exchange rate means travelling to our corner of the globe becomes cheaper.“
The recovery in tourism is expected to continue as international travel picks up further.
Supply-side constraints have eased and are no longer an impediment to the recovery, Vergara said.
It’s likely that 2024 is the year international demand returns to pre-pandemic levels.
China was the second biggest international tourist market in terms of both value and volume, before Covid.
“A recovery in Chinese arrivals is key for the future of the tourism industry. Since Covid restrictions in China have been relaxed in early 2023, we have seen Chinese arrivals make up a larger share of total arrivals.“
Grant Bradley has been working at the Herald since 1993. He is the Business Herald’s deputy editor and covers aviation and tourism.