Before NZ celebrates the border reopening, a few things need sorting out
Surely the impending border reopening deserves a big cheer?
With economic growth balanced on a giddy milk solid, we can now see the light for travel, tourism, accommodation and hospitality.
Stranded Kiwis as well as expats will be welcomed home. New Zealanders will reconnect with relatives and take holidays. Business owners will bolt from the departure gates and travel bookings should surge.
Eventually tourists and cruise ships will creep back to reignite our local markets. International students can restart their courses and our events industry will go into marketing overdrive.
Sounds simple doesn’t it. Five million New Zealanders become six million again, so let’s get on with it.
But before we pop the corks, it might pay to pause.
A damaged economy doesn’t just fire back into life. Human reactions, trust and psychology play a big part. Every transaction and job has a person behind it, and we are not rejoining the world we left behind.
The biggest factors in our successful reconnection are going to be:
Confidence and trust in our border policy
Confidence and trust in our New Zealand passport
Widespread availability of rapid tests to keep businesses open
Financial and tax incentives for re-starting tourism businesses
Simplification of Covid-19 isolation and close contact rules to align more broadly with other markets
If we can’t get this right, Kiwis won’t travel and the rest of the world will remain very cautious about coming anywhere near us. Reconnecting could be a whimpering fizzle.
Restarting the tourism market
Being a no-go zone for two years means we are not in the hearts and minds of international tourists. The playing field has changed dramatically. Most are highly wary of cancellation policies; refunds versus credits versus losses. High levels of flexibility are expected.
While the Covid-19 insurance market has bloomed, border closures or sudden changes in isolation rules don’t allow tourists to claim.
We are competing head-to-head with shorter, one-flight destinations, where testing is lenient (either no pre-flight test or rapid tests such as RATs or LAMPs) and where flexibility is already high.
There are several areas out of kilter with the international market. Publicity of this by travel writers will soon damage Brand NZ, if we open without rectifying these.
Having tourists caught up in 14 to 24-day quarantine requirements if they catch Covid-19 within New Zealand will detract. It has already made international media. Most expect five to seven days.
Arriving in a country where locals appear frightened to take internal flights and where airlines publish infected flight numbers isn’t conducive to providing a tourism experience.
Our close contact isolation rules could cause non-compliance. With no alternative of daily RAT testing or ability to source these tests, it’s a holiday easily ruined by local rules.
Restarting tourism businesses
Covid-19 and closed borders made a train wreck of our tourism market. The loss of small local businesses and experiences has been catastrophic. Yet we need these to maintain our brand.
Right now, who in their right mind would restart a tourism business or rejoin as an employee? It’s a high risk, potentially unstable decision. For the brave souls who do, tax breaks and restart support are a reasonable expectation.
Restarting the travel market
Getting Kiwis travelling again is crucial for travel agents and airlines who have seen their businesses face financial ruin.
But we now have a confidence issue with the New Zealand passport – the little blue book failed citizens and kept them stranded both offshore and onshore. Taxpaying New Zealanders have been financially and mentally ruined by responding to family emergencies, visiting during travel bubbles or being in jobs that involved fly-in fly-out contracts.
Even when our borders open, no one is naive enough to think this topic is a moot point. Variants will continue to occur, and it’s plausible MIQ could be needed at short notice again.
The Grounded Kiwis court case is fundamental in resetting the legal reach of Government regarding the capacity of isolation facilities. Nobody disputes the necessity of solutions such as MIQ, but a booking system invaded by bots for months on end, followed by a lottery with odds of one in 10, can’t be dressed up as smoothing demand.
No New Zealander can risk taking a holiday or responding to a family emergency until the legality of this refusal to increase capacity is addressed.
Sticking our fingers in our ears and pretending this didn’t happen, only puts every New Zealander at risk of it happening to them.
Restarting the international education market
This sector employed 45,000 people pre-Covid-19. But why would a parent in Asia, the European Union or the United States consider paying for a New Zealand university or enrolment in an English language course? It feels unlikely; trust has been wiped out.
They’ve watched us lock out students in the middle of an expensive education. Convincing these parents back to our market is going to need a change of policy on their rights at the border.
Restarting immigration
New Zealand relies heavily on a broad range of skilled migrants. To grow our country and our tax base, these people need confidence in a border that allows safe passage. Right now, would any new immigrant choose New Zealand? The international PR on our border has destroyed trust.
Reconnecting New Zealand to the world, isn’t as simple as opening the gates. Our economic success and recovery will depend on the reaction of the rest of the World and whether our border settings and policies provide confidence.
Janine Starks is the author of www.moneytips.nz and can be contacted at moneytips.nz@gmail.com. She is a financial commentator with expertise in banking, personal finance and funds management. Opinions are a personal view and general in nature. They are not a recommendation for any individual to buy or sell a financial product. Readers should always seek specific independent financial advice appropriate to their own circumstances.