Australia’s tourism focus needs a shift as China’s interest wanes, experts warn

Australia should push to attract tourists from its traditional markets, such as Japan, to mitigate any fall in tourist numbers from China, economists say.

Charles Darwin University (CDU) Senior Lecturer in Economics Dr Maneka Jayasinghe said new research shows that word-of-mouth advertising and repeat visits were key drivers in tourism to Australia, so efforts should be made to reengage traditional tourism markets.

The CDU and Griffith University study, recently published in the Tourism Economics journal, recommended this shift in focus because of an anticipated drop in tourism numbers from China.

In the last decade, the number of visitors from China to Australia increased by about 15 per cent a year, from 353,000 a decade ago to about 1.44 million in 2019.

In 2018, China contributed around 15.5 per cent of total tourist arrivals in Australia, overtaking New Zealand (15 per cent) in the top spot as the source of tourists.

“The growth rate drastically reduced even before the COVID-19 pandemic, to be almost stagnant,” Dr Jayasinghe said.

“It’s set to worsen due to the political and economic tension between Australia and China.”

Dr Jayasinghe, from the Asia Pacific College of Business and Law, said tourism is a highly political phenomenon.

The study looked at the top 20 source countries for the past two decades and found that for every one percent increase in visitors for any one country there was an additional 0.3 per cent growth the following year.

“This indicates that tourists have a good experience and make repeated visits to Australia or spread their positive perception about Australia to other potential visitors,” she said.

Lead author Griffith University’s Professor Saroja Selvanathan, from the Griffith Asia Institute, said the study suggests that despite the slowdown in the growth of tourists from the Chinese markets, the Chinese migrant living in Australia should be enough of a lure to maintain tourism numbers.

“This study finds that despite the deteriorating political relations between China and Australia, the stock of Chinese migrants in Australia would continue to help to increase the Chinese tourist arrivals to Australia,” Professor Selvanathan said.

“One of the recommendations of the study to increase the shortfall in Chinese tourist arrivals to Australia is for the Australian Tourism Industry to target the growing middle-income classes in other growth markets such as India and Indonesia.”

The researchers also recommend that Australia’s tourist industry re-engage with previously strong tourism markets to take advantage of any goodwill.

Read more about the research here.