Is Australia ready for more Chinese tourists? Not even remotely, experts say…

With barely a ripple of controversy, almost the entire sector has swung around to hope the Middle Kingdom will deliver on its promise to deliver one million tourists a year to Australia by 2020, worth about $7 billion.
But that’s nothing. By 2020 it is expected there will be 100 million Chinese travellers heading around the world, so Australia’s expectations seem modest, a mere 1 per cent of the market. Indian tourist numbers also will double to almost 300,000 a year, as will Indonesian visitors, with about 260,000 expected in 2020-21.
In the meantime, tourist numbers from Britain and Europe have slumped. The problem is Queensland isn’t even remotely ready for it – nor is any other state.
The target is for Australia to generate $140 billion a year from tourism by 2020, but even the most optimistic think that’s unlikely because of the current situation.
The resorts that were once a glowing tribute to the 1980s’ entrepreneurial spirit are old, downmarket and suffering from the “apricot effect” of old Miami Vice-style decor.
Even though Brisbane’s hotels are booked solid during the business week, it has been years since a five-star hotel was built in the city because they are seen as financial disasters.
“It’s not until the third or fourth owner that someone makes money out of them,” the Urban Development Industry Association’s Brian Stewart says. That means the first owners inevitably lose money.
There are also few Mandarin speakers in Australia to work as tour guides and, worst of all, the industry needs at least 70,000 rooms built during the next eight years to deal with the flood of Chinese who want a different experience from the one Australia has traditionally offered.
Australia can’t even attract workers into the tourism sector, and from next month the industry will be able to bring in about 1000 Pacific Islanders to fill vacancies. Tourism has a labour shortage of 36,000 and an employee vacancy rate more than four times the national average, which is hindering it from effectively servicing global customers. By 2015, an additional 56,000 people will be needed to fill vacancies.
Australian Tourism Export Council chief executive Felicia Mariani says the biggest mistake Australia could make would be to repeat the Japanese boom experience of the 1980s and 1990s.
“In Cairns you only have to look at what happened with Japan in the 1990s when it crashed,” she says. “You have pockets in this country that relied on Japan as their key market. You have to learn from that.
“There is a lot of emphasis on China as a panacea but you must have a balanced portfolio. Queensland is struggling (to deliver investment on hotels) but you are no different from any other state.
“The signs of concern have been there for some time, but everything was going well and no one thought about the supply-side issue. It’s only in the past two years that supply-side issues have been considered, and they take five to 10 years to fix.
“My fear is we have a lot of operators who have never stepped into inbound. China is the world’s most complex market. There could be dangerous consequences, they could blow their money.”
But it’s a bit hard to overlook the current numbers. In the past year, 530,000 Chinese came to Australia, about 10 per cent of the international visitor total. Any competent tourism operator would want a piece of that.
Australia not only wants China’s tourists but also its money for investment. It formalised its push for both this week in Shanghai, when Tourism Australia launched its latest marketing strategy.
Australia received a small fraction of the potential investment earlier this year when the China-linked White Horse Group snapped up Lindeman Island for $12.5 million.It was considered a bargain buy.
Making the most of China’s wealth is one thing, relying on it is another. China tends to view the world very differently and is not averse to using its economic might as a political weapon.
Last month, the Philippines found out just how tough it can be to rely on their near-neighbour, which is its biggest tourism market but also its opponent in a territorial dispute over the Scarborough Shoal in the South China Sea.
China shut down tourism to the Philippines, with devastating effect. Airlines suspended some of their services. Beijing warned its citizens against travel to the country.
Would it do the same to Australia?
China expert Dr Hui Feng, from the University of Queensland, says the travel ban was part of Beijing’s reaction to a military standoff with the Philippines, particularly the eruption of anti-China protests in that country.
“The use of such travel warnings is widely used in international disputes, but given China’s increasing share of the international tourism market, this case demonstrates that Beijing has been more sophisticated in choosing its diplomatic, political and economic levels in a targeted way,” Feng says.
“Of course the travel ban is among the options for Beijing in a potential conflict with Australia, but Beijing has been very cautious in invoking such measures, depending on how serious the situation is.
“It is therefore interesting for us to observe the process as it unfolds as this is among the first cases in which China has used such a lever in (resolving) its diplomatic disputes.”
Australia has already shown it considers China a potential risk. The Government recently banned Chinese technology company Huawei from working on the National Broadband Network and Defence Minister Stephen Smith ensured he left behind his laptops and phones when he visited the country this week.
Tourism Queensland’s Tracy Vincent says China is a complex market to understand and the tourists coming to Australia don’t want what the Germans or English want. TQ is targeting 22 cities in China.
According to research, the first thing Chinese think about when Australia is mentioned is the kangaroo. The Opera House and Sydney follow and the Great Barrier Reef is fourth. The Gold Coast doesn’t figure in their reckoning until ninth on the list.
“(But) it has to be more than kangaroos that is offered by a destination,” she says. “When you have a Chinese group they want to go fishing a little differently. The idea is that someone will bait the hook, throw the line, then they hold it but as soon as a fish is on the hook someone else will pull it in. Then they want a picture with the fish.
“They expect a chef to cook the fish a special way and the fish they don’t eat they wanted frozen and sent back to China.
“They still want to go fishing – it’s just their expectations are very different from, say, the Americans who just want to fish.”
Vincent says, while China is important, the rest of the world is also slowly starting to return to tourism and the State Government is at least talking about getting behind the industry to spark investment.
One proposal is to open up national parks to eco-style lodges, a prospect National Parks Association executive director Paul Donatiu says people will not welcome.
“I don’t think people go to these places to see resorts. It’s just contrary to what most people are looking for from national parks,” Donatiu says.
He says there is much greater demand for short, sharp experiences, such as half-day interpretive walks.
“National parks take up only 5 per cent of the state. That means there’s still a lot of land elsewhere for development,” he says.
Tourism entrepreneur and Flight Centre chief executive Graham “Skroo” Turner was keen on the eco-lodge plan initiated by the Bligh government until he discovered the costs were too high and that they would be on leasehold land on places such as Moreton and Fraser islands.
He believes Queensland needs more iconic attractions, similar to the walks through Tasmania and New Zealand’s national parks.
“We have a lot of great countryside and wildlife and we don’t make use of that,” Turner says.
He is also a critic of the mining industry and its encroachment on tourism areas such as the Scenic Rim, and he opposes plans for open-cut mines, which he describes as the most destructive form of mining.
Tourism Minister Jann Stuckey says the State Government wants to open up national parks in a sustainable way for tourists.
“Our reputation as a leader in world-class tourism has been lost and we want it back,” Stuckey told an industry forum.
Later this month, the industry will meet in Cairns for the first statewide conference in about 30 years.
The conference will include the critical themes of investment, infrastructure and access, quality, skills and capacity, as well as ecotourism.
The Australian Tourism Export Council’s Mariani says governments around Australia have been less than supportive of the industry and the recent federal Budget actually slashed two sweeteners for foreign investment as well as increasing the passenger movement charge.
“That shows there is no whole-of-government policy development,” she says. “As far back as the 1990s we were talking about a whole-of-government approach. Many states are still talking about it and say they have it, but they don’t.”

Source: Article by John Mc Carthy, the Courier-Mail

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