New modelling shows domestic tourism will partially sustain the sector

New modelling shows that while domestic tourism is unlikely to completely fill the gap left by international visitors, it will help to partially sustain the sector while it recovers to pre-Covid-19 levels over the next two to three years.

To help inform industry and government on the potential shape of the tourism sector’s recovery, Tourism New Zealand has prepared the scenarios.

The modelling shows that:

  • Tourism is one of the hardest-hit sectors and may take the longest to recover due to border closures
  • Recovery is a ‘when, not if.’ Growth will return - whether fast or slow, managed or unmanaged
  • There is a wide range of possible recovery scenarios, indicating that tourism GDP could recover to 80% of pre-Covid-19 levels in 2021 or 2022, depending on key assumptions

“It’s incredibly important that industry and government have this type of information to help inform their decision making,” says Stephen England-Hall.

“The modelling shows that while there are uncertainties right now that will dictate whether that recovery takes one year or two or three. If we have visibility of these variables we can take action to influence them to have positive outcomes for the country's economic recovery like the work Tourism New Zealand is doing to encourage domestic tourism.

Based on the two scenarios covered in the April-May model so far, the biggest opportunities and risks for the tourism sector’s recovery over the next few years are:

  • Trans-Tasman border re-opening – modelled assumptions range from Sept 2020 to Feb 2021 and will depend on bilateral health outcomes and trade negotiations
  • Rest of world borders re-opening - which will also depend on global health outcomes and trade negotiations
  • Demand pacing – consumer confidence and strength of ‘pacing’ or demand uptake in the months that follow domestic alert levels and/or international border re-openings
  • Businesses ability to survive, pivot and compete for a bigger share of Kiwi consumers’ holiday spend, converting outbound holiday spend into domestic tourism value


As a Crown Entity, Tourism New Zealand does not have ‘inside information’ or proprietary knowledge about assumptions such as when domestic alert levels will change or when international borders will re-open. We are therefore publishing our internal modelling and making our assumptions transparent, so that others can input and form their own view.

During these uncertain times, Tourism New Zealand is ‘open sourcing’ its internal IP - as a transparent tool that others can leverage and customize based on new information and assumptions that may emerge over the coming months.

A range of independent forecasts from other organisations is included below.

8 April Westpac Economic Bulletin What Covid-19 means for New Zealand’s tourism sector
13 April Treasury Report T202/973 Economic Scenarios
6 May Westpac Economic Overview Revised Tourism Forecast
6 May Reserve Bank of NZ Economic impacts of COVID-19 containment measures
14 May Treasury Budget and Economic Fiscal Update BEFU 2020

Tourism New Zealand will publish periodic updates to this Scenario Model when material new information becomes available around the key assumptions such as alert levels and border re-openings.