Projected international visitor numbers to Australia have been revised down as geopolitical, economic and environmental issues combine to take some of the sheen off Australia as a tourist destination.
The latest analysis from Tourism Research Australia (TRA) indicates there will be solid growth in international arrivals over the next five years.
The Tourism Forecasts for Australia 2024 to 2029 report predicts an increase of 15 percent in 2024, compared with the previous year, with international arrivals then forecast to increase by a further 41 percent over the following five years.
“Nevertheless, the current forecast path for international arrivals has been revised downward relative to the 2023 forecast,” the report states.
It said the rapid pace of growth observed last year had moderated substantially and was expected to continue to ease in coming years.
TRA found the following factors had a larger negative impact than was previously estimated:
- The growth in geopolitical risks, including escalation in global conflicts such as in Eastern Europe and the Middle East, which can undermine confidence to travel internationally.
- A slower than expected rebound in arrivals from China in 2024, following an initial surge in arrivals following the travel restart in 2023.
- Slower growth of arrivals for the purposes of visiting friends and relatives and employment, which have already neared or returned to pre-pandemic levels respectively.
- The continuation of below-trend economic growth in several countries along with elevated inflation and interest rates, which has continued to weigh on household budgets around the world.
- Changes in global tourism trends, such as the stated shift towards sustainable and eco-friendly travel, which may influence travellers’ consideration of long-haul destinations.
- Policy changes intended to slow the growth in international student arrivals taking effect in 2025 and 2026.
- Competitive approaches to attract travellers (i.e. visa-free travel in Southeast Asia).
The report states that as one of Australia’s largest pre-pandemic markets, the rate of return in Chinese arrivals to Australia had a clear impact on the overall rate of recovery.
“The current projected path has been revised lower than that reported last year. However, as the forecast is the median of a range, it is possible that growth could be faster or slower than outlined,” it stated.
TRA also stressed the larger than expected impact from efforts to reduce carbon emissions in aviation, whether regulatory or industry driven, and the shift in consumer preferences regarding long-haul flights.
“Significantly greater than expected cost pressures facing airlines as they increase capacity, including fuel costs, could lead to slower growth in long-haul routes and higher airfares.”
Download: Tourism Forecasts for Australia 2024 to 2029
