International and Domestic Tourism: Perspectives and Implications - Annotated Bibliography Example

The Principles of Tourism International and Domestic Tourism Perspectives and Implications International and Domestic Tourism Perspectives and Implications The tourism industry in New Zealand is one of the biggest revenue earning industry that not only generates domestic spending but also brings in valuable foreign exchange which is invaluable both to the economy in general and in promotion of tourism. It also helps promote and create infrastructure and provide for work and raise the preference of New Zealand in the international tourist map. Financial implications to the economy are very important to the growth of the industry and therefore this paper concerns itself with the issue of the overall financial implications and development of tourism in New Zealand. Press material for this project therefore largely draws from the government releases and also from books that give us some idea of the subject. Importance of Tourism Overview New Zealand has the tourism industry as its main source of economic progress. The industry is key to job creation and earning foreign exchange. The importance of this key feature is therefore the concern for this analysis. The industry contributes to the GDP at ten percent. Over $6.1 billion is earned through foreign visitors. The industry also supports development of regions, and provides for the private job niches. One out of ten jobs relate to tourism in some way. This will show us the importance of tourism. The Review of news While the general concerns and principles relate to improving the industry, in this study the following subjects were targeted and are being reviewed. 1. News and events pertaining to International tourists 2. Domestic activity and monetary flow. 3. Migration. Tracking information in these areas required direct statistical and authoritative reports and for that purpose the researcher has relied on government sites and publications because those are the genuine releases which are largely reflected by the press and other media. It is also pertinent to state that some books and journals also have been referred in preparation. In The News The News Presented From Recent to Back “New Zealand - Long-haul niche destination ( Sep 2007)” “Whilst international tourist arrivals have been growing rapidly over the last two decades, New Zealand remains a niche destination. Our geographic location makes us a long-haul destination - it takes over 8 hours to get here from most countries. We have a different appeal than high volume tourist destinations like France, Spain, USA and the UK. Research indicates that New Zealand appeals to people seeking adventure, connection with nature, relaxation and revitalization.” Sold overseas and consumed onshore International tourism is a unique type of export - products & services are sold to customers overseas but consumed in New Zealand. This presents the challenge of ensuring that the total tourism experience is consistent with visitor expectations when they purchase their trips to NZ.” “Australians boost visitor arrivals”1 “The news appeared on Monday, 20 August 2007, Press Release: Statistics New Zealand Cathryn Ashley-Jones Acting Government Statistician There were 173,000 visitor arrivals in July 2007, up 6,100 (4 percent) from July 2006, Statistics New Zealand said today. The increase was mainly due to 9,700 (15 percent) more visitors from Australia. Visitor arrivals from a number of New Zealand's other top source countries decreased compared with the same month of last year, including the United States (down 2,700 or 17 percent), Japan (down 1,200 or 12 percent) and Korea (down 1,100 or 11 percent). In the year ended July 2007, there were 2.464 million visitor arrivals, up 87,700 (4 percent) from the previous year. Visitors from Australia (up 49,200 or 6 percent), China (up 19,000 or 19 percent) and the United Kingdom (up 11,200 or 4 percent) contributed most of this increase. However, there were fewer visitors from Japan (down 18,500 or 13 percent). New Zealand residents departed on 185,500 short-term trips in July 2007. This is down 1,300 (1 percent) from the 186,800 departures in July 2006, and is well below the 205,200 departures recorded in July 2005. The decrease in New Zealand resident departures in July 2007 follows increases of 16 percent in May 2007 and 11 percent in June 2007 (when compared with the same months of the previous year). In the July 2007 year, New Zealand residents departed on 1.923 million trips, up 53,700 (3 percent) from the previous year. Trips to Australia were up 23,400 (3 percent) but trips to Fiji were down 8,600 (8 percent). On a seasonally adjusted basis, permanent and long-term (PLT) arrivals exceeded departures by 400 in July 2007. This series has varied around this level since January 2007. It had generally been above 1,000 for the months from December 2005 to December 2006. Actual PLT departures of New Zealand citizens were up 800 and PLT arrivals of New Zealand citizens were down 300, compared with July 2006. Net permanent and long-term migration was 9,000 in the July 2007 year, down from the net gain of 12,100 in the July 2006 year. This is the first time that net PLT migration has been below 10,000 since the March 2006 year.” “Scoring Over The Aussies”2 Christina Putz on 10th August wrote as under: Tourism News – New Zealand August 10th, 2007 “Independent Business news website, Scoop, recently reported on New Zealand’s latest tactic to score Australian tourists – technology. The campaign, launched this week, states that the New Zealand Tourism office will be using text downloading, interactive billboards, WAP technology, and ‘live’ film advertisements, along with regular television commercials to try to bring in more Australian tourists. Chief executive of the National Tourism Organization pointed out that the idea came from the realization that people were using their mobile phones for news, sports and weather, so the tourism office wanted to jump on the bandwagon. The official offer is called the ‘Spring Pass’. Prospective tourists with the Spring Pass will get offers sent to their phone, and will be directed to the new WAP site, as well as the regular tourist sites, where they can find a New Zealand travel deal to suite them. They can also continue to receive offers on their phone once they arrive in New Zealand. Interactive billboards set up in Sydney, Melbourne and Brisbane will send messages to Blue Tooth capable phones as they pass the billboards, offering them travel deals. Journalists from Australia and abroad have been invited to see demonstrations of all the new features that the progressive Tourism office has to offer.” “Tourism Demonstrates Resilience to High Valued Dollar 3 Date Thursday 5 July 2007 “A report released by the Ministry of Tourism today gives insight into the relationships between movements in the value of the New Zealand dollar and the performance of the tourism sector. The research was undertaken for the Ministry by the New Zealand Institute of Economic Research (NZIER). In the long term, the exchange rate is not a determinant of tourism growth. Rather, income growth in our origin markets is key. The research finds that a 1% growth in world incomes typically drives growth in tourism numbers by 1.7%. This characteristic has driven the strong tourism sector performance of recent decades. In the short term, however, the exchange rate has an impact on tourism sector performance, although this varies considerably depending on the performance measures (eg arrivals or spend), purpose of visit and origin market. Key findings from the research are: Arrivals overall are only slightly influenced by exchange rate movements, with a 1% increase in the value of the New Zealand dollar estimated to reduce visitor numbers by 0.02% - a very small relationship. Expenditure by these visitors is considerably more sensitive. For every 1% increase in the value of the New Zealand dollar, expenditure per visitor goes down by 0.8%. Outbound travel by New Zealanders was found to be highly sensitive to movements in exchange rates. On average, a 1% strengthening in the New Zealand dollar will increase outbound holiday travel by 0.87%. “The research shows that international tourism sector is resilient to, but not unaffected by, exchange rate movements,” said Bruce Bassett, Tourism Ministry Research Manager. “It shows that even in a high exchange rate environment the numbers of visitors will hold up very well – driven by the income growth of our markets. Against this, expenditure is clearly more sensitive and we do see reductions of spend that are masked by the underlying growth in arrivals over time. This relationship is reinforced by the latest result from the International Visitor Survey for the year to March 2007 where the expenditure increased by 0.2% to $6.3 billion over a period when international arrivals increased by 2.8%. “Also, when our dollar is high, New Zealanders will make the decision to travel off-shore and this has the potential to dampen the level of domestic travel activity,” said Mr. Bassett. The research found that our markets respond differently to exchange rate movements. For instance, Australia and the United Kingdom were shown to be insensitive to movements, whereas Germany, Japan, USA and South Korea were considerably more sensitive. Holiday travel was found to be more sensitive to exchange rates than other travel purposes such as Visiting Friends and Relatives (VFR) and Business travel. The research also identified the lags that exist with the relationships. For instance, the lag effect between exchange rate movements to its peak impact on visitor arrivals was typically a year and half to two years. For expenditure, there was no lag as visitors’ spending was affected by the exchange rate at the time of their visit. Mr. Bassett added that this research was highly valuable in understanding the relationship between exchange rates and tourism in New Zealand and the findings would inform planning processes both in industry and in government.” Domestic tourist activity causing monetary flow “Spending by domestic travelers increased by 9.3% to $7.5b in the year to December 2006, data released by the Ministry of Tourism shows. ( DTS Media Release April 2007) “The primary reason for the spend increase is considered to be a switch from day trips to overnight trips. Day trips have reduced by 6.4% while overnight trips have increased by 3.3%. Overnight trips generate higher expenditure overall, as accommodation is often purchased. Spending on overnight trips increased by 15.5% to $4.8b while day trip spending decreased by -0.6% to $2.6b. This Domestic Travel Survey result has been corroborated by other key tourism monitors. For instance, outbound travel by New Zealand residents declined by 0.4% over the period which suggests that more Kiwis would be traveling internally rather than heading offshore. As well, the Commercial Accommodation Monitor recorded an increase of around 3% in guest night activity by domestic travelers for the same period. Together, these indicators point to a reasonably buoyant level of domestic travel activity.” Record high US visitors to New Zealand4 Feb 09, 07 “More tourists from the United States are traveling to New Zealand than ever before, a recently released statistics from New Zealand revealed. New Zealand tourism officials said traffic from the US last year grew by 5.2 percent compared to 2005, for an all-time high of 225,629 arrivals. “These unprecedented levels of demand are testament to the attractiveness of New Zealand among American travelers”, says Tourism New Zealand vice president Bruce Lahood. “This result further consolidates the US as New Zealand’s third largest country source of visitor arrivals.” Increased US arrivals is credited towards additional air capacity to New Zealand, including five direct daily flights on Qantas Airways and Air New Zealand, and greater awareness of the destination, which lies just 12 hours away from California. “You leave the West Coast in the evening, and arrive in Auckland in the morning. Few people realize that New Zealand is the same distance as Europe is from the west coast of the USA,” added Lahood. “Americans have also discovered that you can do a lot in New Zealand in a short amount of time. It’s amazing what you can see and do in less than a week in New Zealand.” ”Overall international visitor arrivals to New Zealand reached a solid 2,422,000 visitors in 2006, said New Zealand Tourism.  The US, UK and Australia are New Zealand’s top three tourism markets.” “Your place or mine? Factors influencing NZ tourist departures West Pack Institutional Bank Bulletin (20 July 2006) “• New Zealand’s major tourist market is domestic. Kiwis holidaying in NZ contributed $9.8bn, or 57%, of tourism spending in 2004. • A lot is at stake when New Zealanders decide whether to holiday at home or abroad. • We find that in the long term, New Zealand departures are adequately explained by Population, income per-capita and the cost of air travel. The exchange rate impacts in The short term. • We expect New Zealand short term departures to decline 1% in 2006 and a further 3% in 2007. 2008 is not likely to show any improvement. • The silver lining will come for the domestic tourism industry and retailers, with more Kiwis deciding to spend their holidays at home. Total tourism expenditure, in the year to March 2004, amounted to $17.2bn. Domestic tourism, which includes both business and personal travel, accounted for $9.8bn (57%) of that. Meanwhile, spending overseas by NZ tourists (excluding airfares) was $3.8bn in the year to March 2006 (or $2050 per tourist). Clearly, big money is at stake for the domestic tourism market (and retailers generally) when New Zealander’s decide whether to holiday at home or abroad. New Zealanders have become increasingly travel savvy over the past 20 years. The number of NZ resident departures has lifted from 368,000 in the year to June 1985, to 1.89 million in the year to June 2006. That’s an average growth rate of 8.2% a year. But averages hide a lot and no more so than in recent years. Since mid-2003 departures have grown by a whopping 46%. Nevertheless, Australia remains by the far the most popular travel destination, accounting for 50 percent of all departures in the 12 months to June 2006. In fact, travel to Australia has consistently dominated New Zealand departures, maintaining around 50% market share since at least the 1970s. The report concludes with the following summary: “• the cost of air travel (inflation adjusted).Income per capita influences both business travelers and tourists – during periods of strong economic growth, business travel is higher. And as income per head rises, travel increases almost 1 for 1 with it.4 The real cost of air travel has a substantial influence. For a 10% rise (fall) in real airfares, departures drop (rise) by 8.7% in the long-run. This implies that, holding all else is constant, the recently introduced 10% increase in airfares could reduce departure numbers by 150,000! Forecasts A number of factors are conspiring to force a reduction of New Zealand short-term departures over the next couple of years. These include: • Relatively weak economic growth; • Pressure on the consumers’ discretionary dollar from high energy costs, debt servicing costs, and the potential shutting off of housing equity withdrawal; • Higher airfares (with the 10% rise in international airfares, effective 1 May, still to have their full impact; and a lower currency raising the cost of travel. Following a 25% increase in calendar 2004 and 11% in 2005, we expect departures to decline in each of the 2006, 2007 and 2008 years (by 1%, 3% and 1% respectively). This has the feel of being too conservative, i.e. the falls could be bigger. The silver lining will come for the domestic tourism industry and retailers, with more Kiwis deciding to spend their holidays at home.” “New Zealand happily placed as summer tourists season starts with record arrivals”5 Dec 26, 06 | 10:02 am By Ritesh Gupta l eTN Asia/Pacific “In an encouraging start, New Zealand has witnessed an upsurge in tourists arrivals during the commencement of the summer tourist season. As per the info shared by Statistics New Zealand, visitor arrivals were up seven percent to 229,000 in November compared with the same month last year. During the 12 months to November, 2.4 million visitors came to New Zealand, a record for any month since records started in the late 1800s. The biggest increases for the month were in arrivals from Australia, up 10 percent to 70,700. Visitor numbers from China were up 19 percent or 2200, and from Britain, up seven percent or 2000. Fewer visitors came from Indonesia, Hong Kong and Japan. New Zealand residents departed on 147,600 overseas trips in November, up two percent on the corresponding month last year. As per the information available, ANZ economists said given New Zealand was a long-haul travel destination, visitor numbers were holding up well despite the high New Zealand dollar and oil price volatility. Meanwhile, following recent dreadful incidents involving foreign tourists, it is being propagated that tourism organizations should do safety audits of their regions and improve the quality of information given to protect visitors from getting harmed. The warning came after the rape of a 43-year-old German at the Te Toto Gorge scenic reserve, between Raglan and Ruapuke. Tourism Industry Association chief executive Fiona Luhrs said though the industry “felt ill” about attacks on tourists, they would probably have to increase in frequency to have an effect on visitor numbers. Tourism New Zealand chief executive George Hickton said it was an issue for the whole industry to help keep tourists safe. “Just because it (attacks on visitors) hasn’t had an impact, doesn’t mean we shouldn’t be looking at what we can do better.” Tourism New Zealand hands out safety leaflets to people arriving in New Zealand. They are also in tourism information centers, placed in campervans and the information is available online. Earlier this year, Vodafone and Telecom launched a free service in which people could send a text message to 7233 (Safe) to have their movements recorded on a central database, according to stuff.co.nz” Section 2: News Analysis In analysis of this news, it is noted that New Zealand is a very important tourist destination for international tourists and easily accessible. The key is the exotic locations, culture and easy accessibility of the country that has made it a favorite. We must take steps to improve the facilities, and promote more international class hotels, sites and modes of travel. Care must be taken to use media, internet and other sources of advertising and ommunicating overseas so that more and more international tourists arrive at New Zealand. Regarding the importance of this aspect of development and tourism at a global level, Charles R. Goeldnerand J. R. Brent Ritchie (2005) was of the opinion that tourism creates international impact on all economies. The country which therefore seeks to improve the sector must first provide international facilities for the targeted tourists. This is of two kinds: the first is the local facilities that imparts the country’s flavor to the visitor, and the second those which he or she is used to at the country of origin. Thus we must make sure that the visitor gets an impact surrounding the cultural, ethnic and geographic attractions of New Zealand. At the same time we must develop those areas which are important to the visitor and which he is likely to miss. For example most people use the internet on an off. So we must make it available. Similarly cuisine for various nationals must be available. Venues for international sports like golf and tennis must also be made available near the places of stay. With regard to this view and echoing it a news release followed that highlights the importance of building international class infrastructure and adding that some form of special concession be given to the tour operators in their business. The Dollar earning industry makes resources for many of the nation’s requirements. The Dollar stability is crucial for tourism and while a rise in Dollar against our currency may bring in more tourists who may find the destination less costly, the statistics shows that this difference is marginal. However outbound flow is affected considerably and we can be sure that the tourism activity at such situations reduces foreign exchange flow from the country while at the same time increasing domestic tour activities by our own nationals. The increase of the Dollar rate will cause the resources generated from the inbound traffic to rise in value as against the national currency which will in turn translate into more buying power. Dollar stability is crucial for tourism again. It shows us that key visitors from across the globe spend very less at New Zealand which means a loss in income when Dollar fluctuates. While nothing can be done about the fluctuation, a machinery to alter the domestic prices to suit fluctuations may be considered. For example souvenir items, collectibles and charges for various services and taxes can be reduced in proportion when the Dollar is high, and vice versa. In some countries as in India, in order to nullify the effect the authorities subsidize the entrepreneurs in the tourism industry by providing cushion grants at the time of slump. This results in removing this anomaly to a large extent without making the whole industry seasonal and dependant on external factors to a large extent. Increase in domestic travel spend Domestic travel within the nation is to be encouraged while out bound flow ought to be curtailed. While sanctions in this regard are not possible we can make New Zealand more attractive to the citizens and make them choose locations within the country rather tan overseas travel. The average New Zealander travels abroad and also goes on tour within New Zealand. The contribution to tourism within the country by the national is significant, but we have also to take into consideration the drain of resources generated by inbound tourism through the outbound tourist stream. The results of outbound tourist expenditure eat away most of the gains from inbound tourists. Domestic tourism helps on the other hand to generate GDP. The probable future scenario and the combined effects of the out bound and inbound tourist flow was researched by the West Pack Institutional Bank. The contribution to tourism within the country by the national is significant, The probable future scenario and prediction that out bound tourism may decline in the coming years means progress for the domestic tour sector and entrepreneurs must now gear up to cater to both the inbound and the native tourist in such a way that the interest of New Zealanders lies more with inland tour, and foreigners are attracted to the destinations. Migrations as a special case Migrants to new Zealand provide for tourist activity and income. Migrants bring with them their native culture, and are curious to visit places of interest. They also travel out to their country of origin. Thus they form a major chunk of domestic and international tourism. Jenny Cave, Chris Ryan and Charlie Panakera (2007 PP 435-443 “The development of tourism cultural product in the case of minority peoples has become a mechanism for affirming traditional values, a restatement of identity, and an assertion of political and social aspirations. This is true for Pacific Island communities in Auckland, New Zealand, that are economically, socially, and politically marginalized. These peoples account for approximately 14% of Auckland's population, have retained several traditional features and connections with home islands through extended family networks, and have been well established in the city for over 60 years.” “The study reveals differences between migrant and host communities toward the perceived attractiveness of the proposed tourism development and also indicates issues relating to management and product placement summarized in a model based on dimensions of cultural content and modes of management.” The immigrant and other population have to be integrated into the mainstream life so that they also can participate in the tourism efforts of the state. Conclusion The development of tourism must be at a global level with highlighting of the cultural, ethnic and geographic attractions of New Zealand. The incorporation of visitor needs as per international quality is a must. Special facilities for the visitors resembling those in their country like golf and tennis must also be made available near the places of stay. Bureaucratic procedures and annoyance must be made minimal with reduction in taxes and raise in subsidies for the tourist sector. Since we have known that the Dollar is crucial for our tourism, some form of cushioning ought to be considered. Finally, there must be an alternative to curtail the out bound tours of the natives and encourage local tours. Immigrants also must be encouraged to become a part of the industry and avoid out bound tours. References 1 Ministry of tourism (2007) http://www.tourismresearch.govt.nz/Research/Special+Interest+Topics/Exchange+Rates+and+Tourism+Relationships+in+New+Zealand.htm 2 Ministry of Tourism – DTS Media Release April 2007www.tourismresearch.govt.nz 3 Jenny Cave, Chris Ryan and Charlie Panakera Pacific Island Migrant Perspectives in New 4 Zealand (2007) Journal of Travel Research, Vol. 45, No. 4, 435-443 (2007)SAGE Publications 5 Charles R. Goeldnerand J. R. Brent Ritchie (2005) Tourism: Principles, Practices, Philosophies, 10th Edition ISBN: 978-0-471-45038-2 6 West Pack Institutional Bank Bulletin (20 July 2006) Factors influencing NZ tourist departures On site: http://travelvideo.tv/news/more.php?id=10499_0_1_0_M105 https://digital.odt.co.nz/Login/APDODT2/Site/index.php http://digital.odt.co.nz/Default/Skins/DEMO/Client.asp?Skin=DEMO&Daily=DEMO&GZ=T&AW=1192445621199&AppName=1 http://www.scoop.co.nz/stories/BU0708/S00357.htm http://www.gocurrency.com/international-travel/2007/08/10/tourism-news-%E2%80%93-new-zealand/ Ministry of Tourism – DTS Media Release April 2007www.tourismresearch.govt.nz Read More