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$140 billion visitor spend by 2020 As promised, McEvoy sets industry above-forecast dollar target


Issues & Trends – November 2010

$140 billion visitor spend by 2020
As promised, McEvoy sets industry above-forecast dollar target

TOURISM Australia managing director Andrew McEvoy is now delivering on his six months old commitment to work with the tourism industry to achieve a set of “above forecast” long term dollar targets.

Speaking to travelBulletin in May, McEvoy said he wanted targets set in dollar terms rather than visitor numbers.

Revealing that Tourism Australia (TA) was working with the Department of Tourism on modelling work to translate tourism forecasts into dollar and cents, he said: “We hear a lot of jargon about numbers but people running businesses measure their progress in terms of turnover and margins.”

Importantly, he added, Treasury also looks at spend and evaluates Gross Value Added in assessing tourism’s contribution to the economy.

Now, with TA’s There’s nothing like Australia marketing campaign bed-ded down, McEvoy has spelled out the dollar targets he wants the industry to aim for – no less than a doubling of overnight visitor expenditure from $70 billion to $140 billion by 2020.

This ambitious aspirational goal is at the core of the 2020 Tourism Industry Potential strategy that he unveiled at the inaugural Australian Tourism Directions Conference in Canberra earlier this month.

The strategy received instant industry backing with the Tourism and Transport Forum (TTF) quickly issuing a statement of “full support”.

TTF managing director Christopher Brown called the targets “ambitious” but “achievable with the right mix of public and private investment”.

“The private sector is committed to providing the additional 50,000 hotel rooms that will be needed along with significantly expanded aviation capacity,” he said. “These numbers give the industry something to strive for.”

McEvoy told delegates to the Tourism Directions Conference that, if achieved, the 2020 Tourism Industry Potential will deliver:

  • Increased tourism contribution to GDP – from 2.6 per cent to up to three per cent by 2020.
  • Increased tax revenues from tourism – from $9.3 billion to $14.5 billion.
  • Increased net exports of up to $6.7 billion.
  • Potential of between 40,000 and 70,000 additional rooms needed (at 75 per cent occupancy rates) for the accommodation sector.
  • Growth in aviation capacity – between 40 per cent and 50 per cent for international and between 23 per cent and 30 per cent for domestic.
  • Jobs growth between 12 per cent and 32 per cent or 56,000 to 152,000 additional jobs.

“Over the past decade global tourism has become much more competitive and this is affecting Australia’s share,” McEvoy said. “For Australian tourism to remain competitive we need to take a big picture approach that sees the industry focus on where it wants to be in the next decade.

“The 2020 Tourism Industry Potential is a rallying call to the Australian tourism industry and all levels of government.”

If domestic day trips are taken into account he said the $140 billion target could grow to $160 billion.
TTF’s Brown believes the targets will act as “an incentive for the industry to redouble its efforts”.

But he added: “We also need governments to up their contribution as well, by building vital tourism infrastructure like convention and exhibition centres and new enter-tainment venues and theatres, and through raising their expenditure and commitment to marketing and branding.

“TTF can see no good reason the targets cannot be achieved with the right balance of public and private investment in tourism products and marketing, backed by strong federal and state government policies to facilitate private investment in tourism.”

The unveiling of Tourism Industry Potential follows the launch of the National Long Term Tourism Strategy by Minister for Tourism Martin Ferguson in December 2009 and the Jackson Report which identified the value of targets and goals for the industry.

McEvoy said Tourism Australia’s role in delivering on the Potential was already under way.

“Our focus will be to continue to build demand for Australia’s tourism experience by focusing on a global consumer who is predisposed to Australia and spends more,” he said.

He added that it will also require investment in quality products and experiences, strengthened aviation partnerships and recognition of the importance of the China market.

 

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