Hawke's Bay tourism spending ahead of national average, despite overall decrease

Despite an anticipated drop in tourism spending in Hawke's Bay, the region remains ahead of the national average. Photo / Warren Buckland

Despite an anticipated drop in tourism spending in Hawke's Bay the region remains significantly ahead of the national average.

According to Infometrics' Quarterly Economic Monitor (September 2020), Hawke's Bay's regional economy has begun to recover after the Covid-19 lockdown.

Tourism spending was down 6.8 per cent in the September 2020 year, compared with a decrease of 16.5 per cent in New Zealand as a whole.

Despite the better than average regional spending, the total tourism expenditure was about $628 million in Hawke's Bay during the year to September 2020 - down from $674m a year ago.

Business Hawke's Bay chief executive Carolyn Neville said with borders closed, tourism spending remains an area of weakness for the regional economy.

"With no international tourists or cruise ships visiting Hawke's Bay this season, there's a big spending gap to be filled," she said.

"Every regional tourism operator will be competing hard for domestic visitors, who do not spend at the same level as internationals."

Neville said the Baycation campaign helped support the sector during winter, but the real test will come during summer.

Infometrics estimates that during the peak summer season, New Zealand could lose $1.2 billion a month from the loss of international tourism.

Hawke's Bay Tourism chief executive Hamish Saxton said given the circumstances, the region has performed "exceptionally well". Photo / File

Despite the drop, Hawke's Bay Tourism chief executive Hamish Saxton said given the circumstances, the region has performed "exceptionally well".

Saxton said July, August and September all saw record year-on-year visitor spend for Hawke's Bay, with overall visitor spend up by 12.6 per cent.

"Domestic visitor spend alone was up by 23 per cent, which was enough to offset the loss of international spend during that period."

However, the visitor economy was bracing for this trend to falter towards the end of summer, Saxton said.

"International spend in Hawke's Bay is particularly seasonal, with more than 40 per cent of annual international spend occurring in the three months of summer," he said.

"While we're working to obtain as much domestic tourism as possible during the school holiday period, it's unlikely to fully replace the loss of international visitation, by land, air and cruise, during February and March."

The data also revealed that provisional GDP growth estimate rose 2.7 per cent in Hawke's Bay in the September quarter, while Jobseeker support recipients rose 30 per cent, to 6593.

Neville said Hawke's Bay continues to defy economists' predictions.

"Hawke's Bay is among the best performing regional economies, and we are still doing better than New Zealand overall," she said. "Our strong primary sector is insulating us from the worst economic effects.

"Long-term trends of strong consumer spending, brisk house price inflation and record consenting activity supporting the construction sector are all playing a part in keeping things ticking over economically."

Wairoa and Central Hawke's Bay are doing the best in terms of GDP growth, according to Neville, followed by Hastings and then Napier.

According to the report, Hawke's Bay consumers also spent more in this year's September quarter ($536m) than in the same quarter last year ($480m).

Neville said Wairoa is leading the way for consumer spending, while Napier lagged behind.

"Winter is the time when many in the Bay holiday overseas. With borders closed, some have cash to burn and that's being spent on home renovations and building work, and in retail, with some retailers reporting strong sales into spring."