Times Online - Hugh Osmond, the pub and restaurant entrepreneur, is believed to be planning an audacious £7 billion bid for Six Continents, the hotel and pub operator, ahead of its forthcoming demerger.

Mr Osmond, who has built a reputed £150 million fortune from his involvement in companies such as PizzaExpress and Punch Taverns, is thought to have approached several potential partners with a view to breaking up Six Continents.

It emerged yesterday that Capital Management & Investment, an AIM-listed shell company controlled by Mr Osmond and his associate Alan McIntosh, bought 2.6 million shares in Six Continents late last week for £14 million, giving it a stake of 0.3 per cent.

Although Mr Osmond declined to comment last night, he is known to have held discussions with the Takeover Panel and is expected to come under fierce pressure from it to clarify his intentions towards Six Continents.

Analysts believe his plan is likely to involve a break-up, with Mr Osmond perhaps keeping the pubs and restaurants while passing the hotel brands and Britvic Soft Drinks to various trade buyers and private equity firms.

Most interest is likely to focus on the InterContinental chain, bought by Six Continents in 1998 for £2 billion after an auction featuring Marriott International of the US and the UK’s Hilton Group. Both Marriott and Hilton are tipped to revive their interest, possibly with a real estate partner. A number of private equity firms, including Kohlberg Kravis Roberts and Cinven, are thought to be interested in becoming involved. Ironically, Roger Carr, a non-executive director of Six Continents and chairman-designate of its demerged pub business, is an adviser to KKR.

On Monday, Six Continents published listing particulars for its planned split into two companies, InterContinental Hotels Group and Mitchells & Butlers, and gave an analysis of how the separation would let them perform better.

Despite widespread speculation of potential bid interest from the likes of Mr Osmond, Richard North, who is due to become chief executive of the hotel business, insisted: “It’s hard to see any hotel company that could make a bid for us.” His counterpart on the pub side, Tim Clarke, also played down the likelihood of a bid.

Although analysts voiced little surprise at Mr Osmond’s move, some questioned why he had bought the shares through a public company.

“Either he wanted it to come out to put pressure on Six Continents or else he’s got some clever angle on the funding,” one analyst said.

Capital Management & Investment, originally a putative dot-com company, e-xentric, said earlier this month that it had cash of £41.3 million and was “actively investigating” acquisition opportunities.

Shares in Six Continents fell ½p to 554½p, valuing the group at £4.8 billion, or at about £6.3 billion including debt

Bigger AIME despite industry woes

TravelWeeklyEast.com  -  The 11th Asia Pacific Meetings and Incentive Expo (AIME) opens in Melbourne against a backdrop of possible and imminent conflict in Iraq.

Despite this, economic woes and the aftermath of the October 12th Bali blast, organiser Reed Travel Exhibitions reports a bigger event this year. A total of 647 exhibitors, 49 more than last year, and 338 hosted buyers, 53 more than last year, will take part in the annual event in Melbourne.

AIME exhibitions director David Crooke said a total of 8,000 business appointments were expected to take place over the next two days.

The main increase in exhibitors have come from outside Australia, including Asia and the Pacific. Crooke also reported a record number of hosted buyers from Australia, US, Asia and New Zealand.

Pre-registrations in trade visitors were also up 38 percent, auguring well for total attendance at AIME 2003, said Crooke

Golden Tulip Hotels expands Middle East portfolio 

Golden Tulip Hotels, Inns & Resorts is proud to announce the expansion of its portfolio in the Middle East and Africa through three new properties.

The 200 room Al Bilad hotel in Jeddah, Saudi Arabia – 5 star property - will become the Golden Tulip Al Bilad Hotel as per 1st March 2003. Through the same shareholders, a new 139 unit Tulip Inn Residence Carthage will be opened in June 2003, located directly in the same estate of the existing Golden Tulip Carthage Tunis. Furthermore, the intent for a new hotel and resort in Khasab, Oman has been signed, adding further 60 rooms to the portfolio by the third quarter of 2003, yet to mention that Golden Tulip is adding a new country making the brand represented in 51 countries.

The current Golden Tulip portfolio comprises 16 hotels throughout the Middle East and Africa, with destinations including Kuwait, Riyadh, Amman, Petra, aqaba, Dubai, Abu Dhabi and Cairo.

“The Middle Eastern & African markets are extremely important for the Golden Tulip brand”, states Hans Kennedie, chief executive officer and managing director of Golden Tulip. “The high level of inter Middle Eastern and African travel and business makes it imminent for Golden Tulip to have a hotel in all major cities of that region.” continues Kennedie. “Through the new additions, we are one step closer to offering a pan-Middle Eastern network, providing Golden Tulip with a unique position compared to other hotel chains.” 

We continue our expension plan in this promising region franchising hotels, inns and resorts by getting closer to our owners and franchisees offering them our franchise services of a full fledge franchise as quoted by Mr Amine E. Moukarzel, vice president and managing director for the Middle East and Africa.

Golden Tulip Hotels, Inns & Resorts is a privately owned franchise company with its head office based in Amersfoort, the Netherlands. Since the recent merger with TOP International Hotels, a German based hotel consortium, the Golden Tulip Top Hospitality Group portfolio comprises over 45,000 rooms in approximately 440 hotels across 51 countries, with the majority of hotels being located in urban destinations across Europe, the Middle East & Africa. Golden Tulip offers a unique franchise concept for three brands, designed to implement international standards, whilst maintaining local flavours: Golden Tulip Grand for the five star hotel, Golden Tulip for the four star business and resort hotels and Tulip Inn for the three star category. TOP International Hotels offers hotel reservations, marketing and sales services to independent hotels. Since 1975, Golden Tulip has been the preferred travel partner of KLM Royal Dutch Airlines. 

PATA to award four scholarships for 2003 EDIT Programme

The Pacific Asia Travel Association (PATA) is to award four partial scholarships to the 25th Executive Development Institute for Tourism (EDIT  programme to be held in Honolulu, Hawaii, June 9-27, 2003.

Operated by the School of Travel Industry Management, University of Hawaii at Manoa, EDIT serves the ongoing educational needs of executives and professionals in both private and public sectors of international tourism. The three-week programme, which features lectures, class discussions, case  studies, group presentations and field visits is exclusively designed for individuals with managerial responsibilities in their respective travel and tourism organisations.

Past EDIT participants agree that the programme is beneficial. Sri Lanka’s Jetwing Hotels Executive Director, Mr. Romesh Lokuge, said: “EDIT  reinforced concepts, gave me new insights into tourism and repeatedly identified the all-important inter-relationships that have to work in harmony to ensure sustainable tourism development...Above all EDIT provided a genuine practical forum, which helped to manifest the true value of  networking in international tourism.“

Cook Islands Tourism Corporation Marketing Services Manager, Ms. Karla Eggelton, said: “Where else can you get more than 250 years worth of experience in three weeks? We had access to all this information and experience in an industry that is fast moving and changing.”

Each PATA scholarship is worth US$2,100 and covers about half the total programme cost. If your organisation is a PATA member and you hold managerial responsibilities, PATA encourages you to apply for a scholarship. To do so, submit the following items to PATA Headquarters in  Bangkok, Thailand, by March 15, 2003: 

1. A brief essay on why you wish to attend EDIT

2. A current curriculum vitae or resume

3. An official recommendation letter from your organisation guaranteeing the balance of the programme costs.

4. An EDIT application form

For the application form and more information contact EDIT Programme Coordinator, Mr. Tongchan Srinava (“Aye”). E-mail: aye@pata.th.com

Musings on Diversity Management

By Christina Morfeld

I recently had the pleasure of working with Julie O'Mara (www.omaraassoc.com), a well-respected organizational development consultant specializing in diversity management issues. I learned a great deal as I reviewed Julie's material and conversed with her – first and foremost about myself. One of my more humbling experiences was when I used the term "wheelchair-bound person," only to be gently reminded that "person in a wheelchair" is more appropriate. In my quest for brevity, I unknowingly defined this hypothetical individual by his or her disability!

The moral of the story? Good intentions aren't enough; we must carefully examine our predispositions to ensure that we don't mistakenly offend with our words and actions.

I also gained an appreciation for all that diversity management involves. It goes far beyond assembling a workforce composed of varied backgrounds and experiences. Rather, it is the cultivation of an environment that, by design, honors and capitalizes on these differences. Successful initiatives are deeply rooted in a company's values and are undertaken because – moral and social responsibility aside – it makes good business sense.

Unlike programs carried out for the purpose of compliance or litigation-avoidance, an effective diversity management effort benefits all parties. Employees experience personal growth as they learn from one another's insights and perspectives, and the organization's ability to innovate, solve problems, and meet the needs of an increasingly diverse customer base is greatly enhanced.

But one of the most compelling reasons of all for implementing a diversity management program is demographics, pure and simple. The workforce is changing, and only organizations with a demonstrated commitment to nurturing the uniqueness of its employees will successfully attract and retain top performers.

Providing training does not qualify as a diversity management initiative in and of itself. While helping employees raise their personal diversity awareness is a vital element, it must be supported by other corporate activities such as changes in recruitment practices, introduction of a flexible work arrangement policy, and/or launch of a mentoring program (to name just a few). An organization otherwise risks losing credibility or – worse yet – alienating its workers.

Lastly, it is essential that a diversity management effort not be perceived as yet another one of HR's pet projects (i.e., "flavor of the month"). On the contrary, it should be clearly communicated as an executive-level priority. And, despite my use of words such as "program" and "initiative" throughout this article, it should not be a stand-alone endeavor. Instead, it should be just one component of a fully-integrated business strategy. In other words, diversity management should be tied to the "bottom line" along with a host of other business pursuits.

Diversity management is a serious undertaking that places strong demands on time and resources. An even greater requirement, however, is the willingness of an organization to challenge the status quo and make sweeping changes to its culture.

It's difficult to even know where to begin! That's where a consultant, such as Julie O'Mara, comes into play. And for those brave "do-it-yourselfers" out there, a wealth of useful online resources is available to guide you every step of the way.

Know that whatever approach you choose – if it is done right – will no doubt result in improved employee morale, business productivity, and market competitiveness.

Copyright © 2001-2002 Christina Morfeld and Affinity Business Communications, LLC. Originally

published by Suite101.com. All rights reserved

About the Author

Christina Morfeld is president of Affinity Business Communications, a provider of high-quality instructional design, technical writing, and content development solutions. Whether writing to instruct, inform, or persuade, our work is reader-focused, benefits-oriented, and results-driven.

Contact us at 203-445-9964 or info@affinitybizcomm.com, or visit our website at http://www.affinitybizcomm.com to learn how we can increase your firm's sales and effectiveness!

Companies keep tabs on business travelers

USA TODAY- Many companies are bracing for war and terrorism by making sure they can quickly locate traveling employees, acting on one lesson learned Sept. 11.

The attacks stopped air travel for days, left thousands of travelers stranded and revealed how little some companies know about employees' travel plans.

"One thing we found out with 9/11 was that our travelers are never where they're supposed to be when we need a way to get them," says Kevin Maguire, Tokyo Electron America's travel manager.

In a crisis, fast communication can speed travelers' returns, comfort their families, keep business flowing and reduce legal risk, travel experts say.

"We absolutely had a crisis plan during 9/11, but we realized that it wasn't as comprehensive as it needed to be," says Chris Bomze marketing planning director of TQ3 Maritz Travel Solutions, which helps companies manage travel. "There were situations where clients couldn't find travelers. They didn't know their contact information."

Most companies created or updated crisis plans after the Sept. 11 terrorist attacks, but the current war buildup is raising fresh concerns.

Rosenbluth International, another business-travel agency, sped up its crisis planning while working on clients' plans.

"If we went to war, we wanted to make sure we could respond in the most appropriate, fastest way," says Rosenbluth Vice President Marnie Hughes.

Managers hope to avoid future chaos by:

• Making travel records more accessible. Corporate-travel agencies increasingly are maintaining databases with details of travelers' trips instead of relying on information stored in airline reservation systems, which could be inaccessible in a crisis. The reservations systems were flooded by records requests on Sept. 11.

Clients can tap records and contact information directly and run reports at any hour. They would have the ability to sort by country and other ways.

• Keeping travelers informed. More companies are subscribing to information services like iJet Travel Intelligence, which sends travelers up-to-the minute travel alerts about their destinations via e-mail, cell phone, PDA, pager or the Web.

Alerts can include news about a bombing, anti-war protest or an airline bankruptcy filing — anything that could pose a threat, says CEO Bruce McIndoe.

• Mandating booking through corporate agencies. Companies are trying to prevent employees from booking outside their travel network. Even the most sophisticated tracking systems can't capture trips booked on Web sites unless travelers report them to their employers.
• Making global cell phones available. Companies like Black & Decker and Tokyo Electron want travelers to take global cell phones or other devices on international trips so they can be easily reached. U.S. phones have limited service.  

Conference slump slows De Vere

The Cheshire-based hotel and health club group De Vere announced Friday its ‘pleasing’ start to the financial year has been hit by a fall-off in demand for midweek conferences.

The group, whose properties include the Belfry and Brighton’s Grand Hotel, said concerns over war in Iraq were creating uncertainty among conference buyers.
Like-for-like revPAR at its 21 De Vere hotels increased just 0.3% year-on-year for the four months to January 2003, with sales rising by the same amount. Occupancy was down 1.5 points.

However, the group’s 14 mid-market Village Hotels performed better, with revPAR up 3.3% and sales up 6.2% from the year-earlier period. The 14 Greens health clubs, meanwhile, continued to trade well, with total sales up by 41.8% and like-for-like sales up by 6.7%.

De Vere concluded that the trading environment remains ‘uncertain’, with recovery ‘difficult to predict’. It is nevertheless moving ahead with plans for four new Village hotels, in Maidstone, Bournemouth, Perry Barr and North Birmingham, with the first due to open next year.

China is contemplating the construction of a greater tourism-based economic sphere around the Three Gorges on the upper reaches of the Yangtze, the country's longest river

China is contemplating the construction of a greater tourism-based economic sphere around the Three Gorges on the upper reaches of the Yangtze, the country's longest river.

Gu Chaoxi, deputy director of the China National Tourism Administration, said the planned sphere will cover the scenic sites in Hubei, Hunan and Guizhou provinces and Chongqing Municipality. The area will offer more tourism routes, he said.

A task force has been put in place by organizations including the National Tourism Administration and the Yangtze River Three Gorges Project Construction Committee of the State Council to workout the details for exploring tourism in areas around the Three Gorges and the Three Gorges Project which will be the world's largest water control facility.

It is the first time in China that a regional tourism development program is being planned at state level.

Lu Bin, a specialist on the task force and a professor at Beijing University, said, "After the Three Gorges reservoir beginsto store water early this June, the center of the Three Gorges tourism economy will naturally move eastward, with the dam as the main attraction."

In the past, Three Gorges tourism had been concentrated in Hubei Province and Chongqing Municipality, from which the mighty Yangtze River flows east to the sea. Kuimen, Baidi Town and Mount Shennu at Wuxia Gorge have been the most visited.

According to experts on the task force, the Three Gorges Dam, Xiling Gorge downstream and Gezhouba Dam will be the main spots for the development of tourism around the Three Gorges region.

The provinces involved have been preparing for exploiting tourism resources. Over the past two years, Hubei Province has spent 200 million yuan (about 24.1 million US dollars) on improving its tourism infrastructure, transport conditions and ecological environment.

Yichang City of Hubei, the city nearest to the Three Gorges Project and the main venue of a series of activities designed to mark World Travel Day this year, will use 40 million US dollars of overseas capital to construct 24 new major tourism programs.

Fairmont announces key executive appointments

Fairmont Hotels & Resorts is pleased to announce the recent appointments of several key corporate executives within the areas of finance and technology. Headlining the appointments for Fairmont is the company’s former vice president of technology, Tim Aubrey, who has been named Fairmont's new senior vice president, finance.  Also taking on new roles will be Vineet Gupta, vice president, technology, and Brian McDonald, vice president & controller.

“We believe the appointments and new responsibilities in finance, accounting and technology will further build upon the synergies between these functional areas, a key factor in the company’s continued success” says Jerry Patava, Fairmont’s executive vice president & chief financial officer.

In his new role as senior vice president, finance, Aubrey will have responsibility for the company’s financial reporting, treasury and technology functions.  Prior to this appointment, Aubrey, who possesses a Bachelor of Commerce degree from McMaster University in Hamilton and a Masters of Business Administration degree from the University of Western Ontario, held the position of vice president, technology since January 1999.  During his four year tenure spearheading Fairmont’s IT department, Aubrey established Fairmont as a digital leader in the hospitality marketplace by overseeing the construction of an innovative in-house network infrastructure, introducing new technologies like high speed internet access throughout the chain’s entire portfolio, and integrating new guest and employee based applications to further personalize the guest experience.

Taking over the reins as vice president, technology will be Vineet Gupta. Prior to this appointment, Gupta worked closely with Aubrey as Fairmont’s executive director of technology where he was responsible for managing the operational aspects for the company’s corporate and regional technology services.  Gupta, who holds a Bachelors and Masters of Engineering and an MBA from the University of Western Ontario, will now be responsible for Fairmont’s corporate and operational technology teams.

Within the finance and accounting area, Brian McDonald takes on the role of vice president & controller.  In his new role, McDonald, a chartered accountant who has been with Fairmont for two years now, takes on overall responsibility for all of the company’s financial reporting and control functions.  Prior to joining Fairmont, McDonald spent 18 years with predecessor company, Canadian Pacific Limited.

ABOUT FAIRMONT HOTELS & RESORTS
Fairmont Hotels & Resorts is a collection of world-class resorts and city center hotels that enjoy unrivalled prominence in the communities where they are located. Operating 41 properties throughout six countries, Fairmont is committed to providing guests with exceptional service in distinctive surroundings. Featuring such storied hotels as The Fairmont San Francisco and The Fairmont Banff Springs, Fairmont properties are often deemed attractions in and of themselves. For more information or reservations please call 1-800-441-1414, or visit us online at  www.fairmont.com.

Waterfront acquires Pavilion Hotel Owner

Waterfront Philippines Inc., (WPI) the country’s largest hotel and gaming operator has finalized its takeover of a controlling stake in publicly listed Acesite (Phils) Hotel Corp., owner of the  Manila Pavilion Hotel (formerly the Holiday Inn Manila), for an undisclosed amount.  According to Rex Gatchalian, EVP Hotel operations of WPI, the acquisition of Manila Pavilion is in line with the company’s projections that the country’s tourism industry will experience an up-turn in the next couple of months.  “We firmly believe that with the aggressive tourism related programs initiated by the Macapagal-administration, it won’t be long till the industry becomes robust again” states Gatchalian.  He further adds that their existing hotels in the key cities of Cebu, Mactan and Davao are already feeling signs of this upturn.  “Our three hotel properties especially our flagship hotel in Cebu have all been experiencing near 100 percent occupancy rates since the year started.

With its recent acquisition, WPI further cements its hold as the country’s largest hotel chain.  WPI’s existing hotels, the Waterfront Cebu City Hotel & Casino, the Waterfront Airport Hotel and Casino Mactan and the Waterfront Insular Hotel Davao, cumulatively operates a thousand rooms.  On the other hand Manila Pavilion operates 600 rooms.  “We’re extremely proud to be the country’s largest hotel chain, with a presence in the country’s three major cities Manila, Cebu and Davao,” states Renato Magadia, Chairman of the Board of WPI.  In addition to this,  Magadia also boasts of being the only chain in the country that is fully managed by Filipinos.  “All our managerial positions are held by Filipinos that have cumulatively almost 25 years of hotel experience”, Magadia adds.  One of the company’s major visions is to provide its guests with its own brand of service that reflects the Filipino’s warmth and hospitality.

In addition to being the country’s largest hotel operator, WPI’s hotels also house the country’s largest gaming facilities.  With the addition of Manila Pavilion’s 2000 sq. meters of gaming area, the company now has a total of almost 20,000 sq. meters of gaming facilities.  Plans are now underway to upgrade the group’s gaming facilities.  It can be recalled that WPI announced plans to upgrade its existing facilities as it patterns its hotels with the hotel-gaming facilities in Las Vegas.

Brunei's Billion Dollar Empire Hotel Attracts World's Rich And Famous

A palatial hotel costing billions set in a tropical paradise is attracting the world's rich and the famous to a far off sultanate on the island of Borneo.

Well-healed travelers are beginning to arrive in droves to savor the luxury and the grandeur of the no-cost- spared Brunei's Empire Hotel & Country Club since last year and have been singing its praises ever since.

The Sultanate of Brunei, which owns the hotel is promoting the property, as a first class tourist destination by itself and it seems to have succeeded.

"The hotel and its splendid golfing facilities are top notch tourist destinations themselves," said Brunei's tourism chief Sheikh Jamaluddin Sheikh Mohamed.

"It is a highly marketable commodity and we are going spare no efforts in promoting it," he added.

And there seems to be no doubt about it because they are beginning to come in numbers.

Russians blazed the trail and then there were large numbers from China and Korea. Now it appears it's the turn of Europe to get a taste of what Brunei has to offer.

And the Europeans that Brunei has attracted are a group of wealthy tourists that is expected to project Brunei as a place to visit for the rich and famous. 

The Sultanate's tourism industry got a boost with the arrival of 60 VIPs and wealthy tourists from Switzerland at 8.30 pm last night. The tourists who arrived on a chartered flight were greeted at the airport with the beating of 'Hadrah'.

They were then ushered into two coaches to the posh Empire Hotel and Country Club in Jerudong, which is built on 162 hectares of lush tropical gardens on the pristine shores of the South China Sea.

Present at the airport to greet them were Sheikh Jamaluddin, Director of Industrial Promotion and Tourism Development.

The tourists are on an Asian tour, which also brought them to exotic places including Agra in India, Borubudur in Indonesia and Chiangmai in Thailand.

They are here in Brunei for three days and one of their itineraries include a visit to the rainforest. A large banner reading "Welcome Cross Plus Travel Club" was erected at the arrival hall of the international airport.

Meanwhile another 200 people from Italy from the Incentive Group comprising well-known and wealthy tourists will arrive on February 20. The group will be transported to the Empire Hotel and Country Club in 60 limousines.

Sheikh Jamaluddin said that the tourists were the first European group to come to Brunei since the Visit Brunei Year was launched in 2000. The arrival of the European tourists was the result of joint efforts by the Industrial Promotion and Tourism Development Division, Empire Hotel and Country Club and Royal Brunei Airlines.

It was also the result of the five-year promotional effort and awareness campaign which Brunei tourism authorities conducted during major trade fairs all over the world. Brunei tourism authorities took their road shows to United Kingdom, Australia, China and Dubai to attract more tourists to the Sultanate.

Brunei has been trying to gain a niche in the tourism market by attracting tourists from middle and upper classes, said Sheikh Jamaluddin.

Meanwhile as part of an effort to promote Brunei as a sports tourism destination, an international golf championship will be held at the Empire Hotel sometime this year, he disclosed.

"One of the plus points of the Empire Hotel is we could promote sports tourism, particularly golf. Here is our chance to promote Brunei as the main destination. We are promoting inbound packages throughout the year," he said.

Asked about the recent incident of food poisoning case involving Korean tourists, Sheikh Jamaluddin said the case is nothing new in tourism industry. It can help the local travel agents to improve their services to foreign tourists as such cases could affect the national image of Brunei and the tourism industry as a whole.

The director also said that they have approached the electronic media to advertise Brunei as a unique tourist destination. Advertisements will be aired on CNN and BBC commencing June and allocation of funds towards the promotion has been approved, said Sheikh Jamaluddin.

"We are also in the process of engaging the services of World Tourist and Travel Council (WTTC) as an official auditor to have a more systematic account of the tourism industry," he said and added, "The council will determine where Brunei tourism is heading and its contribution to the national GDP," he added. (Courtesy of Borneo Bulletin)

NZ Tourism faces crash landing

Fly and flop is the disparaging term New Zealand tourism operators use to describe the passive holidays offered by their international competitors.

Sun, sand and snoozes are out. Adrenalin-pumped, action-packed vacations are in among discerning travellers, they say.

But if tourism operators aren't careful, fly and flop might also describe their spectacular rise and possible fall.

Right now they are flying high with international visitors growing 7% a year, more than double the growth rate of tourism worldwide. Pumped with success, the industry believes it has a 10-year strategy in place to cope with the strains of rapid expansion. It is sure the good times will last a long time yet.

In crucial ways though, the industry is starting to show some of the classic symptoms of the boom and bust cycle which has painfully afflicted other sectors. The unquestioning faith in uninterrupted tourism growth should be enough to ring warning bells.

In fairness, the industry deserves much credit for its success. Operators have grown rapidly in capacity and sophistication.

The industry is also marketing itself better. After years of argument over fragmented and short-term campaigns, it is now working cohesively under the clever advertising slogan "100% pure".

Fears of terrorism abroad and a low Kiwi dollar have also helped attract travellers here. Just over two million arrived last year and the industry is forecasting 2.86 million, a 41% increase, by 2008. Even better, they are staying longer and spending more. From $6 billion last year, they are forecast to spend $9.7b in 2008.

While much of the focus tends to be on the industry's glamorous international side, domestic travel is a bigger earner, accounting for 60% of the sector's $13b total revenue. Tourism accounts for more than 10% of GDP.

But this success will continue only if the industry tackles a range of big issues. First, terrorism and war are likely to flare up again over the next few months. This time, though, New Zealand might not seem the safe haven it has in the past, particularly if Australia becomes a terrorist target. The industry will have to craft new messages which are reassuring but not complacent.

Second, the Kiwi dollar will continue to rise. Some operators, lacking faith in their products, will succumb to the temptation of cutting prices to keep competitive. That would be a serious mistake. The real challenge for the industry is to keep improving standards and products so they can charge more. Only then will the industry be profitable enough to invest well in marketing, infrastructure, the environment, training and good salaries.

Third, the industry will have to deal more effectively with the strain it is starting to put on the economy. A key impact is on employment. Being labour intensive, tourism creates plenty of jobs but a high proportion are relatively low paid, seasonal and lacking career paths. Unless the sector deals with all three weaknesses, it will fail to attract enough people to serve the rapidly rising number of tourists. Our reputation for hospitality will suffer.

Fourth, the sector has to deal better with environmental issues. To the industry's critics, tourism is having an adverse impact. They argue the hot spots are already giving tourists much less than a "100% pure" experience.

The number of visitors to Milford Sound has risen 76% in the last 10 years to 450,000 a year - translating into more than 100 bus arrivals and 300 aircraft movements a day at peak times; the number of walkers on the Tongariro Crossing has soared from 10,000 to 65,000 a year in the past decade; trampers on the Queen Charlotte track have trebled in the past four years; and 32,000 people a year are using Abel Tasman, our smallest national park.

And worse, they say, the Department of Conservation is failing its duties by agreeing to a rapidly rising number of commercial activities and concessions on its lands. Approvals rose nearly 80% between 1998 and 2001.

The industry argues that environmentalists are alarmists. It believes it can minimise the burden of tourism by broadening its base in terms of geography, seasons and type. Taranaki and the East Coast, for example, each attract only 2% of international tourists. But if their attributes were better marketed and their tourism infrastructure improved, they could attract many more, taking some of the pressure off the hot spots.

The industry has made good progress in extending its high summer season into the months either side. But it still attracts more than twice as many visitors in December as it does in June.

More diverse activities will help make tourism more of a year-round industry. Nelson's wearable art festival in September or Hawke's Bay winery tours in autumn, for example, will help reduce the sector's heavy dependence on scenery, outdoor activities and summer weather.

To get these messages across to international travellers, the tourism industry will have to take another leap in marketing sophistication without diluting the success of its "100% pure" theme. Arguably, it also needs to find ways to attract more independent, longer-term travellers and fewer short, package-tour visitors.

Such a shift would be angrily rejected by some of the big operators but it would recognise that tourism - like our other industries - needs to be a high value, customised business, not a commodity producer.

While all these measures would help spread the load, there is still an urgent need to ensure many key attractions across the country have long-term plans to cope with growth.

This will require better co-ordination between operators, local government and the Department of Conservation. To date few such plans exist.

Moreover, the tourism industry needs to push much harder for high environmental standards at company level. It says sustainable operations are a top priority for a growing proportion of companies. It cites, for example, the Green Globe 21 programme for environmental certification. Yet this is mere lip-service. Only a tiny fraction of the 17,000 or so businesses in the sector are participating so far.

Above all else, the tourism industry needs to substantially upgrade its management skills. Of the myriad companies in the sector, 80% have fewer than five staff. No doubt many are well run but to cope with fast growth, the industry needs to develop companies which are bigger, more capable and more professional.

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