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ANNUAL REPORT. Once again it is pleasing to bo able to announce yet another record year's working, as the figures in this report show. Despite many adverse circumstances—notably the fear of European war and the drought and bush fires in Australia—new high levels were reached both in the number of visitors to the Dominion and also in the Department's total sales. The former figure is 21,762, including 8,708 who travelled by " cruise ship " (the first time that over 20,000 tourists have visited New Zealand in any one year), while totaj ••sales amounted to £564,787. Sixty-one per cent, of our visitor^"cAfrie (exclusive of those by "cruise ship") from Australia, 16-1 per cent, from Great Britain, 13 per cent, from other British countries, 6 per cent, from the United States of America, and the balance from various other countries. The following figures have been supplied by the Government Statistician regarding the numbers and country of origin of tourists. 1936-37. 1937-38. 1938-39. Australia .. .. .. .. 12,802 14,502 16,692 United Kingdom .. .. .. .. 2,138 2,175 2,105 Other British Countries .. . . .. 1,303 , 1,689 1,705 United States of America .. .. .. 683 724 783 Foreign .. .. .. 371 442 477 17,297 19,532 21,762 No doubt one of the main causes of the increase in total value of sales is the fact that there is a larger amount of money in circulation within the Dominion itself. Though separate statistics are not kept, all the Government Bureaux and sub-agents report an increase in the number of sales to New-Zealanders travelling within the country, while more and more New-Zealanders are availing themselves of the accommodation at the hotels conducted by the Department. This is very gratifying and pays a tribute to the successful advertising campaign carried on by the Department, as well as to the satisfactory management of the hotels. The comparatively large amount spent on overseas publicity has also borne fruit, as shown by the above table, there being an increase over the last record period of 11-4 per cent, in the number of overseas visitors. While it is impossible to state definitely the amount of money spent in the Dominion by tourists annually it is estimated that during the past year New Zealand benefited by approximately £1,500,000. All overseas officers of the Department make a point of keeping in close contact with travel agencies ; indeed, the close co-operation between them has a considerable bearing on the increase in overseas sales. The up-to-date and comprehensive printed itineraries supplied to the agents are much appreciated, and from information received no other country gives so much useful assistance. Results show that this co-operation is most valuable. Much thought and attention is now being devoted to encouraging travel to New Zealand in what may be called the " off season." Ship and hotel accommodation is difficult to obtain during the summer period, and hotel-proprietors would welcome increased numbers of visitors during the winter. An increase in this traffic would encourage them to extend premises and services, and so lead to more accommodation being available when most needed. The institution by the Shaw Savill and Albion Co. of the route from England via South Africa by the luxurious liner " Dominion Monarch " must have a big effect in stimulating tourist traffic from both those countries. The maiden voyage showed that the practically untapped number of South African potential visitors is large, and advance bookings for the next voyage are heavy. Thi; new route will also relieve the shortage of shipping accommodation, besides providing a new direct route of interest and charm. In North America, in addition to special advertising campaigns, the Department has staged courts at the Canadian National Exhibition at Toronto, where our exhibit received a gold medal; at the Golden Gate International Exposition at San Francisco and at the New York World's Fair. The Golden Gate Exposition opened in February, and nearly all Pacific countries are represented. The Department's Pavilion, modelled on a Maori meeting-house, is distinctive and refreshing, and the exhibit, which is purely one of tourist attractions, though modest when compared with the exhibits of some other Pacific countries, is located in an excellent position and is attracting much attention and favourable comment. Large supplies of literature have been provided for distribution, and many inquiries are being received from people interested in travel in New Zealand. The wisdom of participating in the exposition has already been proved. Planned on a larger scale is the New Zealand exhibit at New York, where it occupies the same building as the British and Australian exhibits. Depicting primary and secondary production activities as well as tourist attractions, the exhibit will be most attractively laid out. It is of special interest to note that the dioramas and working models on view in both exhibits are all the product of the Department's own film and advertising studios at Miramar. Turning to internal travel, as has been above stated, New-Zealanders are steadily increasing their patronage of the Department's Bureaux services and hotels. Many appreciative letters have been received from overseas visitors concerning the services rendered by the Department both as regards the preliminary drafting of itineraries in the visitor's own country and the attention given on and after arrival in the Dominion.

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