By Peter Shelley, Managing Director, Australian Tourism Export Council
WITH the Federal Budget delivered and funding for Tourism Australia secured for the next financial year, Australia’s tourism industry now has the job of getting on with getting back to business. But a little over a year on from the borders reopening, the rebuild of inbound tourism remains a challenging and difficult process.
Figures released by the Australian Bureau of Statistics for March 2023 show the number of inbound holiday visitor numbers remains a long way off the success of 2019. While the month was just under 50% down compared with March 2019, the full year reveals we are only around 40% of our pre-covid success.
While attitudes were buoyant during the very successful meetings with international travel wholesalers at the Australian Tourism Exchange event held recently on the Gold Coast, it’s fair to say most members are preparing for a slow and steady return to the halcyon days of 2019. The clear view is that a full recovery may not occur much before the second half of 2024.
From a supply side perspective, the longer-term challenges to the rebuild remains high in the minds of most tourism businesses including cost of flights, increased labour costs and the associated housing shortage (especially across regional Australia) along with higher operating costs generally. This is all contributing to a more expensive Australian holiday offering. With strong competition for the international tourism dollar, Australia needs to offer a standout product to capture the desire and imagination of potential visitors as well as remain globally competitive in the ‘value for money’ ‘pub test’.
From a more optimistic perspective, there are many arguments to suggest the recovery will gain greater momentum than the above suggests, especially given the optimism around the recovery of the Japan and China markets, both of which have been slow to reopen post the pandemic. It’s also pleasing to see some of our historically key international markets hitting their straps with NZ, UK, US, India and Singapore markets all recovering at above average rates.
ATEC also welcomes the Government’s recently released trade diversity discussion paper for the visitor economy, with a view to supporting the inbound tourism industry in actively exploring opportunities offered by new markets.
Right now, our inbound sector is walking a fine line, working to maintain business momentum given the noticeable softening of the domestic tourism market. The recovery of our international market is not yet substantial enough to balance the domestic decrease in the short term, especially given the softening of the VFR surge experience with all markets over the first 12 months of boarder reopening – steady as she goes, with a dose of managed optimism is the outlook.