Chinese tourists leading the charge as domestic visitors fall away
The latest figures provide a mixed bag for TNQ's vital tourism market as the region lags behind in domestic visitor numbers but continues to experience a boom in arrivals from the ever growing Chinese market.
The release of the ABS' Short Term Arrivals and Departures for July shows that Australia’s tourism market is still booming with arrivals up 8.8 per cent across the country year on year for the 12 months to July.
The Chinese market continues to lead the way nationally with arrivals to Australia up 24.8 per cent from this time last year.
While the figures paint a rosy picture nationally, when looking at the data for TNQ economist Pete Faulkner was more cautious, saying there has been a significant decline in domestic visitors and overall tourism expenditure in the region which was having broader economic impacts in the region.
"The reality is that the domestic tourism market is much bigger and more important to TNQ when compared with the international market," he said.
"And domestic tourism has been deteriorating in TNQ and expenditure has been declining for every quarter since March 2016.
"Domestic expenditure in TNQ was $2.06 billion in the year to March 2016 and that was down to $1.89 billion in March 2017.
"International tourists spent $1.08 billion over the same time.
"The number of international tourists visiting TNQ has gone up by a lot, but tourism expenditure in the region has flat lined. There has been very little change in international tourism spending."
TNQ's share of the national domestic tourism market has been steadily declining and dropped by about 100,000 visitors between March 2016 and March 2017.
"Total expenditure for domestic and international tourists has dropped from $3.42 billion in March 2016 to $3.25 billion in March 2017."
This fall in domestic tourism is despite strong results in other regions, with Mr Faulkner saying the decline had coincided with two major coral bleaching events on the Great Barrier Reef.
DIRECT CHINA FLIGHTS A NEEDED BOOST
On the international front, TNQ has been boosted recently with the news that two airlines will start direct flights between Cairns and China in December.
China Southern and Hainan Airlines are expected to bring additional Chinese visitors and millions of dollars to the local economy, with Mr Faulkner saying this is good news for TNQ's international market which has been slowly recovering since the highs seen before the GFC.
"TNQ's share of the international tourism market fell dramatically in the past 10 years," he said.
"The region now attracts about 11.5 per cent of all international tourists to Australia, before the GFC that share was about 16 per cent.
"When the GFC hit in 2007-2008, Japanese visitation was about 250,000 a year, it is 115,000 this year.
"We saw similar falls for UK visitors with a drop from 163,000 arrivals to 91,000.
"There have been improvements in the Japanese and US markets but they are coming off a really low base.
"Positively, in the past 10 years Chinese tourists have grown from about 31,000 to 214,000 this year.
"The difference is Chinese tourists do not stay as long and tourism expenditure depends on how long people are staying in the region.
"So while international visitor numbers are up, how much they are spending here is stagnating."