May milestone: Chinese visitors take #1 ranking
CHINA will soon eclipse New Zealand and dominate inbound tourism for a generation.
By my estimation, a significant development will take place this month, and it will pass with little fanfare.
The number of visitors to Australia from China will finally overtake the number of visitors from New Zealand.
The Census snapshot of overseas visitors shows three spikes: 16-year-old exchange students; 20 to 25-year-old backpackers; and 55 to 64year-old lifestylers, and possibly some businesspeople.
In the year ending January 2017, there were 1.345 million visitors to Australia from New Zealand and 1.229 million from China excluding Hong Kong.
The Chinese visitor market has increased 285 per cent over the past decade.
China overtook New Zealand as Australia’s most valuable visitor market several years ago.
The frugal Kiwis stay with friends and relatives; the bigspending Chinese stay in hotels, shop and visit attractions.
The May transition from New Zealand to China as our biggest overseas visitor market (by number) is symbolic.
Australia’s overseas visitor markets are driven by local prosperity, by connectivity (direct flights), and by migrant and student flows.
It is possible to fly to Australia from six cities in New Zealand. Such connectivity makes it easy to come to Australia.
Australian airports now offer direct flights into 13 mainland cities in addition to Hong Kong.
By the end of the 2020s there could be direct flights between Australia and 30 cities in China – let alone an uplift in the frequency of flights on established routes.
There’s no direct flight to Australia from Tianjin, for example, a city of 11 million. Or indeed from Dongguan (7 million), Foshan (7 million), Shenyang (6 million), Suzhou (5 million), Haerbin (5 million) or Dalian (4 million). China can drive connectivity for another 20 years.
China is now Australia’s leading export market and has been since it overtook Japan at the time of the global financial crisis. It is the country with which we have most connection points.
The reign of the Kiwis lasted 18 years, the Japanese perhaps a decade.
The China incoming visitor ascendancy could remain intact for a generation into the future.
In a decade’s time, it is quite possible Kiwi visitors to Australia will top the 1.6million mark while Americans could top the million mark. The Chinese at this time could offer two million visitors, closing in on three million by 2030.
What does the Australian tourism industry look like with double the number of Chinese visitors? The businesses to be in would be aviation, airport management (and development), as well as dedicated hotels and resorts. There would be demand for Mandarin-speaking staff and associated services such as resorts, casinos and perhaps even medical tourism.
At some point perhaps in the 2030s the market for Australian tourism will peak in China, but by that time perhaps the middle class of India, Vietnam, Thailand and Indonesia will demand overseas travel.
Tourism in Australia has always been an industry comprised of a vast number of smaller operators. In many ways it’s a lot like agribusiness.
And like agribusiness, we have never really projected genuinely large-scale tourism businesses into the global market. But perhaps with the outlook for visitors promised by the rise of China and other countries, there will be scope for enterprising Australian businesses to leverage into globally scaled operations.
Chinese tourists — now more numerous than the Kiwis, who were #1 for 18 years