The economy's return to stability has helped drive a swift
recovery in outbound travel and New Zealand is seeing the benefits
of this, with year-on-year growth in arrivals throughout the first
quarter of 2010.
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Economy
Outbound Travel
Airline Update
Economy
South Korea's economic growth accelerated sharply in the first
quarter of 2010 amid a rebound in manufacturing, exports and
domestic demand. According to the Bank of Korea, the economy grew
7.8 per cent in the first quarter of 2010 compared to the previous
year, the highest growth rate since the fourth quarter of 2002.
Foreign investment is flowing into Korea's stock market,
reflecting investors' positive assessment of the market's recovery
and fiscal soundness.
South Korea's economy is the third-largest in Asia. Its strong
recovery from the global economic downturn has been boosted by
record low interest rates and Government stimulus measures.
The Bank of Korea has forecast that the economy will expand this
year at its fastest rate since 2006. The economic upturn is
reflected in a rise in consumer confidence, which is boosting
outbound travel.
Key Indicators
Sources:
www.economist.com (GDP Growth)
www.xe.com (Exchange rates)
| Exchange Rate vs NZD |
KRW100 = NZD0.123 (11 May 10)
|
| Expected GDP Growth |
+5.1% for 2010
+4.0% for 2011
(Apr 10 est.) |
Outbound
Travel
South Korea's travel industry began to show signs of recovery in
December, with outbound travel returning to growth for the first
time since May 2008. In December 2009, close to 889,000 Koreans
travelled abroad, up 22 per cent on the previous year. Total
outbound travel is expected to grow by 20 per cent in 2010.
The economic recovery, improved consumer confidence and the stable
exchange rate helped visitor arrivals to New Zealand increase by
43.5 per cent in March 2010 compared with March 2009. This was the
fourth consecutive month arrivals had increased.
While travel sellers in South Korea reported slower bookings for
April, the indications are that growth in visitor arrivals will
continue. One important factor restraining growth is a lack of
airline seats, particularly with Korean Air adjusting its capacity
for the shoulder season. The strength of the New Zealand Dollar
against the Won could also pose a threat to recovery in the coming
months
Airline
Update
After a six-month period free of surcharges, airlines
reintroduced fuel surcharges on long-haul flights in September last
year. Rates increased to USD82.00 for January and February, and
rose again to USD100.00 during March and April.
Korean Air has decreased its number of flights to New Zealand to
five per week during the April to July low season. It will return
to daily flights for the winter peak season of July and August, and
then revert to five times weekly from September.
Korean Air will increase the number of weekly flights from four to
daily on its Incheon to San Francisco route from May to October. It
has also increased Honolulu services during the September to
October honeymoon season from daily, to ten services a week.
The airline has also announced a zero commission system for agents
starting from January 2010. Agents are strongly resisting the
decision.
Air New Zealand has been promoting free independent traveller
(FIT) fares and new domestic add-on fares.