Tourism New Zealand says the industry's recovery is beginning to plateau after a stronger than expected return.

Its chief executive, René de Monchy, said the tourism industry was sitting about 50 percent of where it was pre-Covid.

The desire to travel to Aotearoa had been strong and people had embraced the removal of travel restrictions, de Monchy said.

"That first 50 percent of the recovery has come back a little faster than people had anticipated so that's been strong to see. I think the next 50 percent is going to be quite different and quite a bit more competitive."

It was partly due to tougher economic times hitting world markets, de Monchy said.

"We are starting to get some early signals and we're seeing that a little bit in a plateau of arrivals as well, so I think it's going to be pretty competitive for us to be compelling for visitors to choose us as a destination."

But the recovery was not without its hurdles as parts of the industry had struggled to scale back up, particularly with staffing, he said.

"A little bit more demand than expected, a little more supply constraint than expected has meant some challenges."

Mid-April marks a year since the border with Australia opened without requiring quarantine or isolation.

Australia and the United States had both helped the recovery, with arrivals from across the ditch returning to about 80 percent of where it was pre-pandemic, de Monchy said.

The main visitor market that had been missing was China, but he said they were returning now that restrictions there had eased too.

Pre-Covid, tourism was the country's biggest export earner and with its recovery tracking better than expected, de Monchy said there was the potential for the industry to provide a buffer for the economy with tougher times ahead.