These three “mistakes” have recently joined forces to create the perfect storm. New Zealand is now being forced to weather a substantial, but avoidable, downturn in its cruise ship traffic for at least the next year or two. Avoidable – and somewhat confounding – given that New Zealand enjoys a reputation of being one of the world’s most sought-after cruise destinations.
Ships coming to New Zealand continue to be overbooked while the passengers who do make it here rate their time in New Zealand amongst the highest of all cruise destinations in terms of passenger satisfaction.
So where has it gone wrong? To be blunt, there is a gap between how cruise passengers see us and how our Government sees cruise tourism, or perhaps more accurately, values cruise tourism.
Sadly, this is nothing new. Except for the pandemic pause, we have enjoyed year-on-year growth since the start of our regular, seasonal, international cruise tourism sector in the mid-1990s. We even managed to grow our cruise sector during the Global Financial Crisis. However, it wasn’t until 2009, when Sir John Key (then Prime Minister but doubling as the Minister of Tourism) recognised the value of the cruise industry, that any Government acknowledgment was forthcoming.
Unfortunately, successive Governments have been silent since.
As if reinforced by a lack of leadership at the public, marketing face of New Zealand, there is a history of little to no cruise tourism expertise or co-ordination within the Government – not in any of the departments and agencies who are charged with looking after the many aspects of cruise tourism including marketing, safety and security, navigation, etc.
This lack of leadership, experience and co-ordination is, frankly, surprising since cruise tourism has traditionally been and, at least until now, is the fastest-growing sector of our tourism industry, a trend which continues unabated worldwide, generating healthy revenues for cruise destinations.
Until now, the cruise industry has forgiven us our shortcomings and mistakes, continuing to drive the growth in the number of passengers and ships cruising around New Zealand – even up to and including the 2024/2025 season.
However, our rising taxes and other charges, our ageing and inadequate cruise infrastructure and, most critically, our regulatory approach have finally all combined to test the cruise lines’ patience – and bottom lines.
More specifically, it is our somewhat draconian approach to compliance with our bio-fouling regulations that has provoked many cruise lines to call time on New Zealand. No one questions the need for such regulations, especially when our natural beauty is our leading tourism product and many of our primary industries depend on the sea for their existence.
However, when the regulators forbid a ship from entering New Zealand because she missed filing her compliance report by one day and, more seriously, not being able to offer ships any services to enable them to clean their hulls, then questions need to be asked about whether the compliance procedures and costs are fair and balanced.
This downturn will have a particularly significant impact on our ports and their owners who are, in most cases, regional councils. Over past years, cruise tourism has proven to be a welcome source of revenue for our ports as changes in our economy affect (often negatively) commercial shipping patterns.
Having the additional revenue source that cruise ships visits generate would be particularly welcome now, as the world’s trade environment is being upended. But for the lack of certainty and the imposition of rules without a solution, our ports – and our regions – would enjoy, and continue to enjoy, greater financial returns.
While I’m on the topic of a lack of Government understanding about tourism, here’s another example. The recent announcement by the Government that it is going to target Americans, Australians and Chinese tourists through a $13.5 million promotion investment is, well, kind of dumb.
Americans, fine – there are enough high net-worth individuals among them to make them a good target for such an investment. But Australians? They are not among our highest spenders, partly because so many come over to see, stay with and be fed and entertained by family and friends and anyway, many are likely to be Kiwi expats visiting home.
Our Chinese visitors arrive on Chinese airplanes, stay at Chinese-owned hotels and are ferried around on Chinese-owned motor coaches. Not a lot of new revenue for New Zealand. Sad that the Government hasn’t learned from the same scenario back in the 1970s/1980s with our Japanese visitors. They arrived on Japanese airlines, stayed in Japanese-owned hotels and rode around in Japanese-owned motor coaches, not generating the levels of new-revenue visitors that non-controlled source markets generate.
Speaking of high net worths, questions can (and should) be asked why the Government is seeking volume over visitors who can and are keen to spend money here. Volume isn’t a good strategy, given that there are likely to be fewer visitors who are in a position to spend meaningful amounts and, well, by the numbers, volume can lead to over-tourism – especially among cruise passengers.
Again, we’ve been through this loop before. Back in the ′90s, young backpackers flocked to New Zealand. Wonderful experiences for them, but they didn’t spend much.
What this discussion demonstrates is that there needs to be a systems approach to cruise tourism in New Zealand. We have a pile of expertly written and highly readable strategies commissioned by our over-arching cruise tourism body, the New Zealand Cruise Association, and by individual ports and their cruise managers and cruise committees.
However, as my comments indicate, there is a vast gulf between our very professional cruise sector and the Government. We have too many national, regional and local agencies making their own rules and imposing their own taxes and levies. It all adds up to and results in an expensive and somewhat incomprehensible mélange of paperwork which needs to be filed at every port before the ship can be cleared for passengers to disembark to enjoy their day and spend money onshore.
To be cleared, the ship must report on stuff like food stores, barnacles on the hull, number of passengers with communicable diseases, information about crew and/or passengers joining or leaving at the port, fuel, planned rubbish disposal, etc.
Sure, all of the regulations for the most part make sense and are necessary. But, as we are now acutely aware through the bio-fouling debacle, a better approach needs to be adopted – perhaps a more light-handed approach that doesn’t compromise our environment.
It would also be cool if the Government could join up all its cruise-related activities to work with our cruise tourism sector in a collaborative, information-sharing kind of way. It would be even more cool if the Government would stand up for the cruise sector in an official, public-facing role that champions the industry-leading work done by our cruise sector membership organisations and port committees, port operators, suppliers, operators – all stakeholders involved in New Zealand’s cruise tourism sector.
We are now the only destination in the world that is losing cruise traffic involuntarily (ie we are not like Barcelona, Palma de Mallorca and Bar Harbour, Maine who are deliberately limiting the number or size of ships), despite New Zealand being among the most popular destinations among cruise passengers.
Instead of perpetuating an adversarial environment that exists now with respect to our bio-fouling regulation, we need to figure out how we can leverage off our unshakeable and highly lauded goal of protecting our environment.
We need to work out a collaborative approach that exploits the collective expertise of Government, the cruise tourism sector and the cruise lines; seeks to reduce the burden of costs and compliance without sacrificing our environmental goals; and figures out an innovative plan to work through the biofouling and other compliance and cost challenges.
- An earlier version of this story incorrectly said the Government was investing $175 million to target tourists, not $13.5 million.
