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Luxury cruise business pumping millions into Kiwi coffers

Feb 06, 2016

WELLINGTON, New Zealand - New Zealand's cruise industry is set for a record year by busting through the half a billion dollar earnings mark.

P&O ship Pacific Pearl is beginnning a record five-month "home-berthing" in New Zealandthis week, marking a new high for an industry that's been growing at 20 percent a year.

Cruise NZ's forecast for this year is for the sector to inject $543.3 million into the economy, and $540.1 million the following year. The impact on Auckland alone was expected to be in the region of $250 million in the current season.

Ann Sherry, executive chairman of Carnival Australia, is predicting continued expansion for cruising in our waters.

Growth that fast makes New Zealand a stand-out global performer because the worldwide cruising industry has logged just 2 per cent growth.

Ann Sherry, the executive chairman of Carnival Australia, which owns the Pacific Pearl, said: "Australia and New Zealand have been the fastest-growing collective market in the world for the last five years. The New Zealand share of that is significant."

She said the current cruise season would give a good indication of demand for the mix of short and longer cruises among locals and foreign tourists in our waters.

Cruise New Zealand chairman Kevin O'Sullivan said the economic impact of cruising in New Zealand waters had increased five-fold in the past decade, and if "from a cruise ship" was a country, it would be the third largest source of visitors to New Zealand.

But he warned that the good times may stall for a while.

Growth has been driven by a number of factors- including the rise and rise of younger people and families taking cruises - but the industry is hanging great hopes on the rise of cruising in Asia, and China in particular. O'Sullivan said

In the past year, Chinese cruisers were a tiny portion of the passengers on cruiseliners, so few in number that Cruise NZ's figures don't even split them out. Just over 50 per cent of passengers were Aussies, 20 percent were North Americans, 11 percent were Kiwis, ten percent were Brits or Germans, with Chinese passengers lumped in with the eight per cent of nationalities in the "other" category.

"This season were are estimating over $500 million of economic benefits to New Zealand," O'Sullivan said, but he added it would then "plateau for the next few years".

After the breather, things looked set to pick up again. Carnival will take delivery of a new 4000-plus passenger cruise ship to be built in Italy for the Australia and New Zealand markets with delivery expected in 2019. It has no name yet. Each ship is named by a "godmother", who can be male or female. The godmother of the Pacific Pearl is Olympian Barbara Kendall. The new ship is more than twice the weight and passenger capacity of the Pacific Pearl.

The country does have issues that need to be addressed, "O'Sullivan said. The Shed 10 terminal where cruise ships can dock serves Auckland well, with passengers disembarking right at the foot of Auckland's Queen Street, but Carnival and Cruise NZ are in talks with Auckland Council-owned Ports of Auckland because the bigger cruise ships of the future are going to be too large to berth in the current facilities.

The truly gargantuan Ovation of the Seas is arriving in New Zealand late this year carrying 4500-5000 passengers. It will have to "tender" in Auckland, using watercraft to bus its passengers ashore.

There also remains concern about the new border clearance levy introduced on 1 January, which sees air passengers and those arriving on private craft paying $18.76 a head excluding GST, but people arriving by cruise ship paying $22.80 a head, again excluding GST. The Government says the reason for the difference is it costs more to manage the biosecurity risks of a cruise ship than other forms of craft on which people arrive in New Zealand from overseas.

Luxury cruise business pumping millions into Kiwi coffers

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