Written by Alan Wood, Stuff

International visitor spending is projected to increase 48 per cent to $11.1 billion by 2021, according to new Government forecasts.

Tourism leaders are confident that industry forecasts of 6 per cent annual growth through to 2025 are on target following the release of the new forecasts by the Ministry of Business, Innovation and Employment (MBIE) on Monday. MBIE released the new information at the annual Trenz gathering of the country's tourism operators and international tourism buyers.

Tourism Industry Association chief executive Chris Roberts said the MBIE spending forecasts equated to about 5.8 per cent of extra international spending each year, which was within reach of the industry's own 6 per cent target. "It really gives us confidence we are on target, and it is realistic to keep aiming for 6 per cent growth year on year out to 2025," Roberts said.

The higher expectations are driven by both higher visitor numbers and higher spending by those visitors. In 2014 about 2.9 million international visitors flew into New Zealand and those numbers could grow to 3.75 million by 2021.

Combining the spending of international and domestic tourists, the New Zealand tourism industry was worth about $23.7 billion. Last year the industry released a Tourism 2025 strategy to grow that total to $41b by 2025. To achieve that level of growth visitor spending will need to enjoy 6 per cent compound annual growth.

MBIE general manager of institutions and system performance Michael Bird said international visitor arrivals are expected to increase four per cent a year for the next six years. This will see 3.8 million visitors arriving in New Zealand by 2021. Most of this is expected to come from holidaymakers and those visiting friends and relatives.

"Australia is New Zealand's largest visitor market, providing more than 1.2 million visitors in 2014. The forecasts show this market will continue to be healthy and looks set to grow by three per cent a year to 2021," Bird said.

In 2014 Australians spent $2.054 billion or 28 per cent of all international visitor spending in New Zealand. That is expected to leap to $2.296b in 2021 when 1.535 million Australians are expected. "Another key market for New Zealand is China, and we expect the annual growth rate for Chinese visitors to outstrip all other traditional markets."

Chinese spent $1.037b in 2014 with that number expected to jump to $2.612b in 2021 when 571,000 Chinese are expected in New Zealand. Even with any significant slow down of growth in China, Chinese visitors to New Zealand would remain important to New Zealand, Bird said. This year's tourism forecasts, which are partly based on modelling from NZIER, include emerging markets India and Indonesia for the first time.

Indian tourists are forecast to grow by 12 per cent a year, and reach 82,000 visitors in 2021. Indonesian tourists are forecast to grow by 13 per cent and reach 35,000 in 2021.