Australia seeks China's tourists as U.S. visits wane

By Enda Curran and Geoffrey Rogow

Reuters

Tourists from Beijing taking photos in the northern Australian city of Cairns.

SYDNEY—Australia will launch this week a new initiative to attract more visitors from China, as the usual tourists from the U.S. and Japan stay put in the face of uncertain economies and the strong Aussie dollar.

The campaign will focus on collecting research on China's emerging middle class and its main cities in an effort to double the number of Chinese visitors to Australia by the end of the decade. In the first quarter of this year, roughly 129,000 Chinese short-term visitors came to Australia, about 9% more than the number of U.S. citizens that headed Down Under, according to data from the Australian Bureau of Statistics. In the year-earlier period, the percentage of U.S. visitors was 14% higher than China visitors.

The number of U.S. tourists coming to Australia has been nearly flat at about 40,000 per month for most of the decade, but it dipped in 2009 as the U.S. economy suffered a hit. Meanwhile, the U.S. dollar has lost about one-third of its value compared with the Aussie since the end of 2008, making the trip increasingly expensive for Americans.

Faced with outcry from the local tourism industry, the government and groups in states such as Queensland, home to the Great Barrier Reef, are eyeing a greater share of the $48 billion that the Australian government estimates that 57.4 million Chinese travelers spent overseas last year.

"We know how important this market is going to be for us," said Kerri Anderson, a spokeswoman for Tourism Queensland, which has set up "China-ready" workshops for those in the holiday industry throughout the tourism-rich Queensland state.

Outside mining, tourism is one of Australia's biggest sources of foreign currency earnings, accounting for more than 2.5% of gross domestic product worth an estimated 34 billion Australian dollars ($36.5 billion). But the industry has suffered not just from the strength of the Aussie dollar but also a sharp loss of visitors from tsunami-hit Japan and flooding that hit large swathes of Queensland.

Increasingly, Australian tour operators are seeking to attract wealthier Chinese tourists as incomes in the world's second-largest economy after the U.S. rise quickly.

"The industry for Chinese tourists used to be just dominated by these cheap tour groups, but that simply doesn't work anymore," said Harry Gu, 45, managing director of Flag Travel, a holiday company based in Shanghai and Sydney. "We're collecting data on the booking habits so that we can see where things trend over the next few years."

The market for Chinese visitors will be the central focus of a summit starting Tuesday in the tropical resort of Cairns, located in the far north of Queensland, with senior government officials and airline executives attending. The event will also see the government's Tourism Australia office unveil its initiative to increase the country's share of Chinese visitors.

Australia isn't the only tourism hotspot seeking to lure more Chinese visitors. Cities like Dubai, New York and London have placed attracting Chinese tourists near the top of their agendas.

Aware of the competition, Australia signed a deal in April with China to expand the number group tours allowed by the Asian country. But Australian tourism businesses say more will need to be done to win market share.

"I'm not sure we have what we need to look after this market," said Janene Rees. The 46-year-old business-development manager at Moonshadow Cruises & Port Stephens Four Wheel Drive Tours is based in New South Wales, a state that boasts Sydney, the Blue Mountains and the wine-growing Hunter Valley among its main attractions.