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New Zealand

Tourism reset would hurt agricultural exporters

The Government’s proposal to reduce future international tourism visitor numbers post-COVID to concentrate on higher spending visitors may solve one problem but create others.

Research by Lincoln University’s Dr Rob Radics, Dr Muhammad Umar, and Associate Professor Anthony Brien, highlighted that most of our agricultural products delivered fresh to market are transported on passenger planes, and tourists contribute to the cost.

The drop in tourism numbers could push up transport costs to the point some businesses do not export at all and are put out of business.

Their work showed that before COVID-19 hit, there were 550 international flights into and out of New Zealand each week, which carried 80% of New Zealand’s overall export airfreight in their belly-holds, and that it was worth $10.8 billion in December 2019.

Only 20% of New Zealand’s airfreight was carried by dedicated air cargo-only freighters.

Before COVID-19, air freight was less than 1% of New Zealand’s total trade by volume, but about 16% in terms of dollar value.

The report raised that the decision may show a lack of understanding of the inter-relatedness of industries.

“What COVID-19 has highlighted is the not previously considered symbiotic relationship of some sectors of the New Zealand agriculture industry and tourism.”

Transport costs have already gone up because of reduced flights, as In March 2020, COVID-19 bought tourism to a halt and reduced airfreight capacity.

This resulted in an immediate increase in competition for freight space and the Government stepped in to fund additional dedicated airfreight cargo flights to ensure the export of perishable products.

It initially funded 53 weekly flights to key export markets. By November 2020, airfreight flights (dedicated cargo and empty-of-passenger flights) had increased to 120 per week; however, export freight costs also increased as producers competed for space on flights.

For more information: lincoln.ac.nz


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