Great shortfall of China: Australia's biggest tourism market returns with a whimper

SYDNEY - When China

ended a lengthy border closure in January,

e-commerce marketer Tianni Ren immediately began planning a team building trip for her 14 colleagues to Australia, hoping to see its stunning pink salt lakes that had captivated her on social media.

But she ended up taking her colleagues from the city of Hangzhou to New Zealand, after learning Australia had been dropped from a list of destinations approved by Beijing for group overseas travel, effectively halting a two-decade programme that had helped China dominate Australia’s A$45 billion (S$40.17 billion) international tourism market until early 2020.

“We asked our tour agent but were told that Australia was not on the group tour list,” said Ms Ren, 28, referring to the Approved Destination Status (ADS) that China gives about 60 countries. “It is a pity that we did not get to see the pink lakes.”

After three years of struggle and anticipation, the widely expected wave of returning Chinese tourists Down Under has turned out to be a trickle as the visa rules – coupled with relatively high costs, a lack of flights and an exodus of Mandarin-speaking guides – squeeze Australia’s fourth-largest export industry.

In February, the first full month since China’s border reopened, Australia recorded 40,430 short-term visitors from the country, government data showed.

That was one-fifth the number who visited in the same month in the record year of 2019 and well behind visitors from New Zealand, Britain and the United States.

Flights from mainland China to Australia, meanwhile, were just one-fifth of pre-pandemic capacity in February, according to aviation analytics firm Cirium, as soaring fuel costs jacked up fares and dented demand.

At the same time, total Chinese outbound border crossings had reached two-thirds of pre-pandemic levels, according to the Chinese Outbound Tourism Research Institute, a consulting group based in Germany.

The government in Beijing did not give a reason for ending Australia’s ADS status, but travel industry participants say geopolitics has played a role, with bilateral relations at a low ebb amid trade disputes and increasingly strident rhetoric about national security between the West and China.

Government marketing body Tourism Australia declined to comment.

Trade promotion office Austrade said Tourism Australia’s managing director visited China in March to meet strategic partners such as airlines and the body would “continue to work closely with its key distribution partners in the market to realise tourism opportunities between Australia and China”.

“It’s definitely tied up in geopolitics and trade and other things where we’ve seen a decline. You can’t disentangle that from the current situation,” said Dr Paul Stolk, a lecturer at University of Newcastle business school who is working on a university-government collaboration to diversify the tourism sector.

Dr Stolk added that Chinese travellers often choose overseas destinations where they have family members who are studying.

China was Australia’s biggest source of foreign students until 2019, but

students of other nationalities have filled its foreign student ranks

since Australia reopened its border in 2021.

Australia’s tourism industry is also constrained by lack of foreign language-speaking guides and essential personnel, including coach drivers, industry participants said, as the Covid-19 downturn followed by the lowest unemployment level in decades drew workers to other fields.

“We’ve lost a lot of quality staff who know their way around,” said Mr Peter Shelley, managing director at the Australian Tourism Export Council.

“We’re hearing that (Chinese nationals) can’t wait to get out and travel after not being able to travel for so long, and Australia has always been a place that has high aspiration to travel, but our capacity to service has been reduced.”

Some independent Chinese tourists in Australia told Reuters they were visiting because they had relatives in the country who arranged accommodation and tours, meaning they could bypass the language barrier and other issues.

Mr Johnny Nee, director at Easy Going Travel Services in Perth, which connects Chinese visitors with hotels and cruises, said his partner organisations had filled the shortfall of Chinese tourists by catering to the domestic market.

“When Chinese tourists return en masse, I’m worried that the supply will not catch up with demand,” he said.

Ms Ren, the marketing director, said her colleagues enjoyed their New Zealand trip, where they bought a few Gucci bags, but remained disappointed they missed their first choice of destination.

“I really do hope we can go to Australia next time,” she said. “We cannot stop thinking about the magical pink lakes.”
REUTERS