By Stephen Wright
WELLINGTON, New Zealand--New Zealand said it will allow quarantine-free travel from Australia, the first significant easing of its pandemic-related border controls since shutting the country to nearly all travelers a year ago.
Prime Minister Jacinda Ardern told a press conference on Tuesday that the so-called travel bubble with Australia will begin on April 19.
Australia has allowed quarantine-free travel from New Zealand since October but New Zealand didn't reciprocate, partly due to small Covid-19 outbreaks in both countries.
Ms. Ardern said the risks of transmission of the virus in Australia and New Zealand are low but travelers should be aware that the quarantine-free travel arrangements could be disrupted by outbreaks in either country.
"Quarantine-free travel will not be what it was pre-Covid-19, and those undertaking travel will do so under the guidance of flyer beware," she said.
The easing of New Zealand's controls is likely to be a boost for small businesses that rely on tourism. Some 600,000 New Zealanders are long-term residents of Australia and before the pandemic, Australia accounted for two out of every five visitors to New Zealand. About 15% of visitors to Australia were from New Zealand.
Aided by their remote geography, both Australia and New Zealand limited the spread of Covid-19 through strict lockdowns and border controls. Combined, they have had fewer than 1,000 deaths attributed to the coronavirus.
Popular destinations such as New Zealand's alpine playground, Queenstown, are likely to be winners from quarantine-free travel but there are also offsetting factors that will damp the overall impact, ANZ's New Zealand chief economist Sharon Zollner told Dow Jones Newswires.
Domestic retail spending and local tourism in New Zealand could take a hit given people will soon have the choice of traveling to another country, she said.
Also, the people with the most incentive to travel could stay with the family or friends they have been separated from for a year and won't spend so much.
On balance, New Zealand should capture more of the economic benefit given that Australia's population is five times larger, Ms. Zollner said.
Shares of Australian and New Zealand travel and tourism companies were boosted by the travel bubble plan.
Air New Zealand Ltd., which said it will boost Australia flights from a skeleton schedule to 70% of pre-pandemic capacity, jumped 5.8%. Sydney Airport Holdings Ltd. rose 2.8% and Qantas Airways gained 3.1%.
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(END) Dow Jones Newswires
April 06, 2021 03:37 ET (07:37 GMT)Copyright (c) 2021 Dow Jones & Company, Inc.