Australia
Tourism contributed AUD 60.8 billion to Australia’s GDP in 2018-19 – representing 3.1% of total GDP. The sector directly employed around 666 000 people or 5.2% of total employment, more than the agricultural and mining industries combined. Travel exports accounted for 65.5% of total service exports in 2018.
International tourist arrivals were up 3% to 9.3 million for the year ending June 2019. These international visitors spent a record AUD 44.6 billion, representing a 5% growth on the previous year. Domestic overnight visitor spend also reached a record high of AUD 77.5 billion over the same period, up by 15%.
Australia’s top inbound market by spending is China, followed by the United States and the United Kingdom. Chinese visitors spent AUD 11.9 billion in the year ending June 2019, which is up 5.9 % on the previous year and account for 27% of total visitor spending by international visitors in Australia. This share has increased strongly over the last decade, and is up from 10% in 2008–09. Tourism Research Australia forecasts that by 2028–29, 2.6 million Chinese will visit Australia annually and spend AUD 27.4 billion.
Domestic tourism experienced significant growth in 2018-19, with Australians taking a total of 340.1 million trips over this period (up 12% compared to 2017-18), of which 33.3% were overnight visits and 66.7% were same-day trips.
The Australian Trade and Investment Commission (Austrade) works closely with Tourism Australia, the Department of Foreign Affairs and Trade, and state and territory governments to co-ordinate the delivery of whole-of-government tourism objectives. Austrade is responsible for tourism policy, projects, programmes and research. Within Austrade, Tourism Research Australia provides international and domestic tourism intelligence, including statistics and analysis.
Tourism Australia is the Government agency responsible for attracting international visitors to the country. Formed under the Tourism Australia Act of 2004, it delivers partnership marketing to targeted global consumers in key markets to grow demand and foster a competitive and sustainable Australian tourism industry. The Department of Foreign Affairs and Trade works to strengthen bilateral tourism relationships and to leverage key multilateral tourism bodies. All state and territory governments in Australia incorporate tourism into their portfolios to ensure effective international and domestic tourism promotion and industry development.
Tourism Ministers’ Meetings (TMM) bring together tourism ministers from the Australian, state and territory governments to discuss tourism policy matters of mutual interest. Chaired by the Australian Government Minister for Trade, Tourism and Investment, the Tourism Ministers’ Meetings has collective responsibility for implementing the national tourism strategy, Tourism 2020. Its work is supported by the Australian Standing Committee on Tourism (ASCOT), which is chaired by Austrade and includes representatives from Tourism Australia, the Department of Foreign Affairs and Trade and each state and territory tourism organisation, and relevant state departments with responsibility for tourism policy. Representatives from the tourism industry can be invited to attend ASCOT and TMM meetings as requested.
In 2019-20, Tourism Australia was allocated a budget of AUD 154.1 million. This includes AUD 14 million for the Asian Marketing Fund, AUD 2.5 million for the Working Holiday Maker campaign, and AUD 2 million for promotion of the T20 World Cup cricket in India.
At the beginning of 2019, the Australian Government announced a number of new funding initiatives to support tourism, including:
AUD 50 million over three years for Tourism Icons projects in five locations to help drive tourism demand into regional Australia.
AUD 40 million over four years for an Indigenous Tourism Fund to further develop this important sector of the Australian tourism industry.
AUD 11 million over four years to attract more Chinese tour group tourists to Australia.
Source: OECD, adapted from the Australian Government, 2020.
Tourism 2020 is the long-term strategy to build the resilience and competitiveness of Australia’s tourism industry and grow its economic contribution. Launched in December 2011 and running until December 2020, it was the first time that national, state and territorial strategies to drive tourism demand and policies to grow the supply side were brought together in a co-ordinated manner. In terms of roles at the federal level:
Austrade co-ordinates at the federal level to ensure policy settings support the supply side.
Tourism Australia drives international demand through marketing and industry development activities.
Department of Foreign Affairs and Trade leads and manages Australia’s bilateral and multilateral tourism relationships.
Tourism Research Australia underpins the strategy with data and insight.
Tourism 2020 set the ambitious target of doubling overnight visitor spend to between AUD 115 billion and AUD 140 billion by 2020. Thanks to strong co-operation between industry and all levels of government, overnight visitor spend reached AUD 122.1 billion in 2018-19, and is on track to achieve AUD 134 billion by the end of 2020.
Since 2009, total overnight spend has increased by AUD 51.1 billion (up 72%) and an additional 40 400 rooms have been added to the accommodation stock in Australia’s top ten tourism cities. International aviation capacity has grown by 67%, while domestic capacity has grown by 21%. Linked with this, 159 500 additional employees have joined the tourism workforce. Tourism 2020 has been an unifying force within the sector, with states and territories setting their own targets for overnight expenditure, with the strategy continuing through multiple changes of federal government. The development and ongoing industry ownership of Tourism 2020 has been recognised as policy best practice, and Australia is looking to re-create this as the next strategy is developed to come into force at the beginning of 2021.
The challenges facing Australia’s tourism sector are to continue to drive sustainable growth of increased visitation and yield from a balanced portfolio of markets while at the same time managing key supply side issues such as increasing investment in tourism infrastructure, building the capacity and capability of the tourism workforce, and appropriately growing air connectivity:
Growing demand for visitation to and within Australia is vital to reaching the upper range of the Tourism 2020 spend targets. To achieve this, Tourism Australia maintains a balanced portfolio approach in its international marketing, with investment in 15 core markets reflecting the greatest opportunities for sustained growth.
Since making tourism a national investment priority, Australia has achieved record levels of international investment in tourism infrastructure. The Government has in recent times shifted its focus from investment attraction to project facilitation to ensure the pipeline of tourism infrastructure comes to fruition.
In 2015, there were 38 000 unfilled tourism positions across Australia, which restricted the sector’s ability to meet growing demand for Australia’s tourism products, services and experiences. This is being tackled by: working with the industry-led Tourism and Hospitality Labour and Skills Roundtable; establishing a Skilling Australians Fund, which provides funding to states and territories to grow the number of apprentices and trainees to support Australia's future productivity, jobs and growth; and delivering the Tourism Employment Plans (TEPS) in partnership with states and territories. These TEPS are three-year plans that outline tailored strategies for a region to meet its specific labour and skills needs.
A key pillar of the Tourism 2020 strategy is the goal of increasing international aviation capacity to Australia by 50% to 26 million annual inbound seats in total. This target was met four years early, however work has continued to ensure aviation capacity increases ahead of demand. In June 2019 there were around 58 international airlines and 1 954 international flights into Australia per week, which equates to a capacity of 26.9 million seats per annum.
Improving regional dispersal is a focus to grow the Australian tourism industry. While 44 cents in every tourism dollar is spent in regional Australia, regional dispersal remains challenging, particularly for international visitors. To this purpose the Government appointed an Assistant Minister for Regional Tourism in May 2019, and is providing funding for regional tourism infrastructure through the Building Better Regions Fund (Box 1.10).
In 2018, the Government commenced the process of developing its next 10 year tourism strategy, which is being progressed under the working title of Tourism 2030. An industry steering committee was established, which reported to Government in December 2018 on its vision for the future of the tourism industry. Challenges highlighted by the steering committee included: maintaining Australia’s competitiveness, the sharing economy, technology, ultra-long haul travel, emerging markets, international education, and social licence. Priorities included: drive visitor demand through marketing, aggregated and segmented data analytics capability, addressing capacity constraints, technology, providing a suitably skilled and available workforce, and building a sustainable tourism industry. Building on the work of the steering committee’s report, it was identified that further consultation and opportunities for direct input by state and territory governments and the broader tourism industry would help build shared ownership of the strategy. This will also ensure that the national strategy aligns with individual state and territory strategies. Development work is continuing with the intention that the strategy is considered by Ministers during 2020 with a commencement date of 1 January 2021.