Asia and Pacific

Potential benefit to New Zealand of Trans-Tasman Visas

Wednesday May 04, 2016 Hugh Dixon

Based on 2015 visitor numbers, a Trans-Tasman Visa arrangement could potentially be worth $2.5 billion a year to New Zealand from the China market alone.

 

The Tourism Industry Association New Zealand (TIANZ) and Tourism and Transport Forum Australia (TTF) have called for a permanent Trans-Tasman Visa arrangement. This is after the success of a temporary Trans-Tasman Visa arrangement which was implemented during the ICC Cricket World Cup 2015. This temporary arrangement meant that visitors travelling between 26 January and 5 April 2015 only required an Australian visa to travel over to New Zealand.

 

The New Zealand Government's review of this temporary visa arrangement during the Cricket World Cup showed that during the 39 days it was in place, 7,239 travellers from 77 nations entered New Zealand using the Trans-Tasman Visa. Of these 7,239 travellers, around 40 per cent were from China.

 

To determine the potential of a Trans-Tasman Visa we need to look at the number of visitors arriving in Australia and New Zealand each year. From the total number of visitors arriving those who could take advantage of such a visa would need to come from a country which requires a visa and also be travelling for a purpose that would allow them to visit both countries.

 

For the purposes of this analysis we will look at Chinese holiday makers. China is currently the largest visitor market for both Australia and New Zealand where visitors need a visa to visit. Visitors arriving for a holiday are also the most likely to be looking to visit both New Zealand and Australia. For the year ending December 2015 Australia had 6.9 million visitors arriving, of which 3.1 million were arriving for a holiday. Out of these visitors, 950,000 were visitors from China, and of these 511,000 were holidaying in Australia.

 

For the year ending December 2015 New Zealand had 3.1 million visitors arriving, of which 1.6 million were arriving for a holiday. Out of these visitors, 356,000 were visitors from China, and of these 272,000 were holidaying in New Zealand.

 

There is currently little public information on the number of visitors going to both New Zealand and Australia on the same trip. To understand the potential benefit to New Zealand we need to look at the extra spending that would occur if all 511,000 Chinese holiday makers who visited Australia in 2015 will now visit New Zealand as well.

 

With Chinese visitors to New Zealand spending on average $4,885 per person, these 511,000 extra visitors could potentially bring into New Zealand an extra $2.5 billion a year. Even getting 10 percent (50,000) extra visitors would provide New Zealand with $250 million in extra spending per year.

 

But for New Zealand to realise a significant portion of the potential benefits from a Trans-Tasman Visa arrangement there would need to be an extensive amount of work done to attract Chinese visitors to visit New Zealand as part of a trip to Australia.