1. Tourism bonanza, or pipedream?
INFORMER
Byline: JONATHAN MORRIS
Australian tourism has strong long-term growth prospects, according to official
predictions. The Tourism Forecasting Council (TFC) says that by 2012 half the
nation's inbound tourists will be Asian, and Austrade tips that by 2020 more than two
million Chinese will visit Australia each year.
Australian tourism has strong long-term growth prospects, according to official
predictions. The Tourism Forecasting Council (TFC) says that by 2012 half the
nation's inbound tourists will be Asian, and Austrade tips that by 2020 more than two
million Chinese will visit Australia each year.
But not everybody in the industry believes the hype.
Asian tourist numbers may be rising but, say some Australian tour operators, it has
been a case of growing volume but no profit. They say some Chinese and South
Korean travel agents are forcing them to provide cheaper tours and pay higher
commissions, sometimes almost eliminating profit margins.
An Asian tourism specialist at the University of New South Wales, Roger March,
says most Chinese and South Korean visitors choose holidays based on price rather
than destination or content. This means domestic tourism operators have to sacrifice
profit margins to win their business. March says that some margins are so slim that
many operators approved to bring tourists from China to Australia are "not willing to
go near the Chinese tourism market with a barge pole".
Tourism consultant Ken Corbett says: "These markets are so price-competitive that
most suppliers are unable to make any profits. The Chinese like things to look at that
don't cost very much." He says group trips to public gardens and scenic lookouts
pose a challenge to an industry seeking to add value to the tour experience and to
increase earnings. "I would like to know what the average Chinese tourist wants," he
says. "All I know now is what their tour operator wants."
Operators usually want international tourists to shop more. This is cheap for
operators, fills in the tourists' time and offers the prospect of a commission from shop
owners for taking customers to them.
Surfers Paradise retailer Peter Vertzyas claims some Chinese tour operators have
demanded that a shopkeeper pay as much as $180 per tourist before allowing a
group into a store. Vertzyas says tour groups are kept away from many retail areas
and taken, instead, to warehouses, where the goods are overpriced.
The Queensland Government is aware of the damage being done to the state's
$14.6-billion tourist industry and wants to stop these practices. Tourism Minister
Merri Rose intends to introduce legislation in early 2003 to register inbound tour
operators, enforce a mandatory code of conduct and outlaw unprincipled behavior by

2. tour guides. Despite the problems, many operators are still confident of the potential
of tourists from China. Queensland's Movie World, Victoria's Sovereign Hill and
Sydney's Blue Star Cruises say they are attracting many more Chinese tourists.
A growing economy and an expanding middle class have fuelled explosive growth in
Chinese and South Korean tourist numbers. South Koreans visiting Australia have
surged from 14,000 in 1990 to an estimated 187,000 last year. The TFC expects the
figure to be 442,600 by 2012.
In 1999, Australia became the first Western country to win Chinese Government
approval for tour groups from China. Since then, Chinese visitors have more than
doubled, from 93,000 in 1999 to an estimated 194,000 last year. JONATHAN
MORRIS
Tourism bonanza, or pipedream?
Australian tourism has strong long-term growth prospects, according to official
predictions. The Tourism Forecasting Council (TFC) says that by 2012 half the
nation's inbound tourists will be Asian, and Austrade tips that by 2020 more than two
million Chinese will visit Australia each year.
But not everybody in the industry believes the hype.
Asian tourist numbers may be rising but, say some Australian tour operators, it has
been a case of growing volume but no profit. They say some Chinese and South
Korean travel agents are forcing them to provide cheaper tours and pay higher
commissions, sometimes almost eliminating profit margins.
An Asian tourism specialist at the University of New South Wales, Roger March,
says most Chinese and South Korean visitors choose holidays based on price rather
than destination or content. This means domestic tourism operators have to sacrifice
profit margins to win their business. March says that some margins are so slim that
many operators approved to bring tourists from China to Australia are "not willing to
go near the Chinese tourism market with a barge pole".
Tourism consultant Ken Corbett says: "These markets are so price-competitive that
most suppliers are unable to make any profits. The Chinese like things to look at that
don't cost very much." He says group trips to public gardens and scenic lookouts
pose a challenge to an industry seeking to add value to the tour experience and to
increase earnings. "I would like to know what the average Chinese tourist wants," he
says. "All I know now is what their tour operator wants."
Operators usually want international tourists to shop more. This is cheap for
operators, fills in the tourists' time and offers the prospect of a commission from shop
owners for taking customers to them.
Surfers Paradise retailer Peter Vertzyas claims some Chinese tour operators have
demanded that a shopkeeper pay as much as $180 per tourist before allowing a
group into a store. Vertzyas says tour groups are kept away from many retail areas
and taken, instead, to warehouses, where the goods are overpriced.

3. The Queensland Government is aware of the damage being done to the state's
$14.6-billion tourist industry and wants to stop these practices. Tourism Minister
Merri Rose intends to introduce legislation in early 2003 to register inbound tour
operators, enforce a mandatory code of conduct and outlaw unprincipled behavior by
tour guides. Despite the problems, many operators are still confident of the potential
of tourists from China. Queensland's Movie World, Victoria's Sovereign Hill and
Sydney's Blue Star Cruises say they are attracting many more Chinese tourists.
A growing economy and an expanding middle class have fuelled explosive growth in
Chinese and South Korean tourist numbers. South Koreans visiting Australia have
surged from 14,000 in 1990 to an estimated 187,000 last year. The TFC expects the
figure to be 442,600 by 2012.
In 1999, Australia became the first Western country to win Chinese Government
approval for tour groups from China. Since then, Chinese visitors have more than
doubled, from 93,000 in 1999 to an estimated 194,000 last year.
Caption: ILLUS: Visitor volume growing, but not the profit. Heath Missen
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Publication: Business Review Weekly
Publication date: 30-1-2003
Edition: Late
Page no: 19
Section: News and Features
Length: 1163