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Tourism to Oz hits nine-year high but spending lags

July 29, 2014 Destination Global, Headline News No Comments Email Email

egtmedia59Improved economic conditions in the US and Britain have contributed to the strongest growth in international visitors to Australia in nine years, with arrivals projected to grow more than 5% annually over the next three years, according to the Tourism and Hotel Market Outlook report.

Released by Deloitte Access Economics, the bi-annual report provides in-depth analysis of the issues and trends impacting the Australian tourism and hotel sectors and presents forecasts for hotel market performance across ten individuals markets.

The report shows international visitor arrivals grew 8.2% over the year to May driven by a 9.4% increase in leisure travel.

While growth continued to be driven by arrivals from Asia, “improving economic conditions in the US and UK” contributed to a further acceleration in arrivals from those markets.

Growth in international visitor nights showed a more modest increase up 0.5% over the year to March while trip duration shortened across the board.

Report highlights:

  • Arrivals from Asia continued to show growth over the year to May 2014 with China growing by 11.9%, Malaysia by 20.4% and Singapore by 16%
  • Arrivals from the UK grew 11.9% over the year to May, a turnaround after having fallen by almost 20% over the previous six years
  • Arrivals from the US grew by 9.1%, their fastest annual growth since March 2010

Despite that apparently rosy outlook, the Tourism & Transport Forum (TTF) has warned that Australia is missing out on billions in additional economic benefit, with new figures showing visitor spending is tracking below the bottom end of the Tourism 2020 targets.

TTF acting chief executive Trent Zimmerman said significant reform and investment is needed to help Australia achieve its goals.

“The Tourism 2020 target is to increase overnight visitor spending to between AUD 115 and AUD 140 billion a year by the end of the decade, but at the moment we are not even going to reach the bottom end of that range,” Zimmerman said.

“TTF believes that with the right investment and policy frameworks, the AUD 140 billion is an achievable target.

“The federal government and state and territory governments around the country have committed to the Tourism 2020 targets, however current investment in tourism is not sufficient to achieve those goals.

“A business as usual approach to tourism is simply not enough to reach the Tourism 2020 targets or for tourism to fulfil its potential as an economic development strategy for Australia.

“Additional government investment in tourism marketing is required to ensure Australia does not lose market share to countries that have not only recognised tourism’s potential to drive economic activity, create jobs and provide future prosperity, but have invested in tourism marketing and the infrastructure required to make that happen.

“We acknowledge that some jurisdictions have increased tourism marketing funding and acknowledge the public investment in demand-driving infrastructure like the International Convention Centre Sydney, the expanded Adelaide Convention Centre and the new Perth Stadium.

“We also appreciate that work is being done to improve visa processing, reducing the complexity and application timeframes, and to facilitate nature-based tourism activities.

“However, all jurisdictions must recognise the value of tourism marketing, with numerous studies showing a return on investment of between AUD 8 and AUD 16 for every dollar spent on international tourism marketing.

“Additional government funding would also facilitate extra private sector investment, delivering greater reach and frequency for campaigns in key markets.

“Tourism already supports more than 900,000 jobs around the country and generates AUD 43 billion in GDP, but that contribution could be even greater, especially with the mining investment boom waning and heavy manufacturing continuing to decline.

“We are calling on the federal government and all states and territories to recognise the value and potential of tourism as an economic development strategy that can deliver future prosperity to Australia and to back their rhetoric with action.”

Edited by : Peter Needham

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