Aussie $119.4bn tourism trade on upward trend
Australia is a hot destination for tourists who are boosting the $119.4 billion sector. Now new IBISWorld research reveals the sector is poised for even more growth.
The analysis firm expects international travel to Australia to grow at an annualised 5.1 per cent over the five years through 2022-23, to reach 11.7 million visitors, largely driven by tourists from China.
Jason Aravanis, IBISWorld senior industry analyst, said “In 2017-18, China is set to become Australia’s largest source of visitors, overtaking New Zealand, marking the largest change since China overtook the United Kingdom as the biggest spender on travel in 2010-11.
“While Chinese tourists will exceed New Zealand visitors, traditional markets such as the United States, United Kingdom and Japan have also grown.”
IBISWorld research found that international travel to Australia has increased at an annualised 8.2 per cent over the five years through 2017-18, to reach 9.1 million visitors. A surge in visitors from the United States, Malaysia, India and China has driven this growth.
“Over the past five years, a weaker Australian dollar has made Australia a relatively affordable travel destination compared with similar countries, such as the United Kingdom. In addition, rising middle-class wealth in China has increased the number of households with sufficient discretionary income to travel overseas,’ said Aravanis.
Growing travel to Australia has boosted revenue for hotels and resorts by an annualised 2.7 per cent, despite disruptive forces in the industry.
The popularity of Australia as a destination for Chinese tourists is particularly beneficial for Australian businesses, as Chinese tourists tend to spend more relative to other visitors. According to IBISWorld research, several Australian industries, including travel agency services, restaurants and casinos, have benefited from this trend.
Australian travel business
But it isn’t just overseas visitors who will be boosting the coffers of the tourism industry. According to IBISWorld, domestic tourist visitor nights are projected to increase by an annualised 2.7 per cent over the five years through 2022-23, to total 401.4 million.
‘The Australian dollar is projected to remain weak over the period, making it more expensive for Australians to undertake overseas trips. According to Tourism Research Australia, Australians are expected to spend $108 billion on domestic tourism in 2022-23. This is a good sign for operators that generate significant revenue from domestic travellers,’ Aravanis pointed out.
‘As more Australians make domestic trips during this period, travel operators will appeal to home country travellers by offering premium services, discounted upgrades and all-inclusive packages to better compete with international offers,’ added Aravanis.