Perspective – June 2011

Support for the outbound industry

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Ian McMahonSupport for the outbound industry

THE Australian Council of Tour Operators (CATO) has a tradition of electing chairmen capable of enlivening industry dialogue with the injection of robust, not to say headline-catching, commentary. And it is fair to say Rod Eather fits comfortably within this tradition.

Eather, elected as CATO chairman a year ago and newly re-elected for the next 12 months, was outspoken in his address to the council’s annual general meeting held in Sydney earlier this month. He homed in on the support that Australian governments extend to this country’s inbound (and, indeed, domestic) operators.

Eather made it clear that he has absolutely no quarrel with the recovery assistance recently provided by governments, in the wake of disasters such as the Queensland floods, to tourism businesses reliant on inbound and domestic markets. But why, he asked, are outbound operators (that is to say the sorts of businesses run by CATO members) not also eligible for the kind of support provided to their inbound and domestic counterparts?

As an aside he referred to the AFTA-led delegation of leading travel agents and wholesalers who visited Queensland to investigate how they could assist tourism businesses kick-start traffic back to the state following the tragedy of its floods.

Many of the businesses seeking the support of these bricks and mortar retailers had earlier abandoned the agency distribution network in favour of direct selling over the internet, Eather noted.

“It’s about time the Government started to assist us as well,” he said, pointing to the contribution made by outbound operators who employ up to 30,000 Australians.

He said his comments were intended to provoke discussion as a first step to achieving greater government recognition. Not surprisingly his comments were well received by the approximately 70 outbound wholesaler representatives who attended the meeting.

But AFTA chief executive Jay Westbury sounded a note of caution. He said that for Ministers such as Tourism Minister Martin Ferguson outbound operators were, in some ways, the “devil incarnate”, the people who sent prospective domestic holidaymakers overseas.

It was a “difficult” issue, he said, noting that the inbound visitors attracted to Australia are other countries’ outbound traffic and Australia relies on a flourishing two-way trade.

The outbound industry would be wise to heed Westbury.

Like, say, purveyors of such cars as Mercedes, BMW and Saab, outbound travel sellers are importers adversely impacting on the balance of trade – and currently greatly assisted by the value of the Australian dollar.

Like car companies such as Holden and Ford, inbound and domestic operators are local manufacturers – currently crippled by the value of the Australian dollar.

It is obvious which group has the most powerful case for government support. But that doesn’t mean the industry should not engage in the discussion that Eather intended his remarks to provoke.







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