Australia’s tourism industry has the potential to rebound strongly from Covid-19 thanks to ‘revenge spending’; a term coined to describe pent-up Chinese consumer demand in the 1980s that was unleashed after the chaos and poverty of the Cultural Revolution.
Fast-forward to today’s unique situation and every Australian who’s been stuck in isolation has probably quaran-dreamed about the places they’ll go, when we can finally leave our houses. Tourism Australia has been encouraging isolated travellers to dream a little bigger with a LIVE program of virtual events from underwater experiences to backyard BBQs, hosted by some of Australia’s most iconic personalities.
With many investors expecting the domestic leisure segment to lead the recovery, hoteliers are hoping for a swift turnaround when we finally elbow bump goodbye to the coronavirus. Indeed, a ring-fenced Australian public offers unrivalled opportunity if destinations can attract the more than 6 million Australians who headed overseas for a holiday in 2019. But where will prosper and for how long?
A watershed moment for the tourism industry, Australia became a net exporter of tourists for the first time in history in 2007.
The outbound travel trend by Australians has grown exponentially over the past decade, far outpacing the growth in inbound visitation. The Australian visitor index reached a low point in FY12 of 0.747 when weakness in the global economy weighed heavily on inbound tourism demand, whilst the relative strength of the Australian economy and the record high Australian Dollar spurred more Australians to head overseas. In FY19, 11.3 million Australians headed outbound, far outweighing the 9.5 million visitors who arrived on our shores and resulting in a visitor index of 0.832.
Australian Tourism Visitor Index – Inbound/Outbound Visitors FY08 to YTD March FY20
Source: Australian Bureau of Statistics, Colliers International
Note: Australia is a net exporter of visitors when the index is below 1.0
Source: Tourism Research Australia, Colliers International
Australia’s tourism industry has the potential to regain some of the losses from Covid-19 thanks to ‘revenge spending’ and a rebounding domestic leisure segment after Australians have spent more than two months cooped up indoors.
Restricted domestic flight schedules are putting the once mainstay of Australian tourism – the great road trip – back on the cards. This has the potential to bring significant economic benefit to regional towns over the next few months.
As social distancing measures relax, the freedom now being afforded is also encouraging Australians to dream a little bigger and plan bucket-list trips as they look to rediscover the beauty of their home shores. Proximity to the two largest southern state economies affords Queensland the greatest opportunity to thrive as the brightness of the sunshine has never glowed so strong, but timing will be key.
National Director, Transaction Services | Hotels Asia Pacific
Karen has over twenty years of experience in the hotel industry and holds a Masters of Business Administration (MBA) from the Australian Graduate School of Management. She brings with her a specialised knowledge of the Asia Pacific hotel investment market and an ability to drive fresh capital into Australia’s hotel markets. She has developed an exceptional network over the past two years across Asia and the Middle East and within government, in her capacity as Senior Investment Specialist Tourism Infrastructure at Austrade and her knowledge of new entrants into the growing Australian tourism sector is second to none.
Colliers International Hotels team have put together a series of articles to help the hotel and tourism industry chart the course to recovery, as one of the sectors most acutely impacted by social distancing measures introduced in response to Covid-19.
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