Tourism now trumps coal exports

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A new report suggests Australia makes more money selling tourism services to foreigners than it does from exporting coal. Based on September quarter figures, annualised tourism exports of $47 billion, were greater than those two stalwarts, rural exports at $42 billion and coal at $41 billion.

Though iron ore is still the nation’s biggest export, exports of services, including tourism, are predicted to contribute up to 0.5 percentage points to economic growth this year.

Experts suggest that the reason for the tourism boom could be because services exports—which also include education, and business services—are on the upswing.

The weaker Aussie dollar makes Australia cheaper for foreigners to visit, and deters those in the country from travelling overseas, and holiday within the borders instead. Much of the inbound tourism boom is concentrated in Sydney and Melbourne, rather than the regions that probably need the boost much more.

The number of short-term arrivals to Australia is now rising at the cracking pace of 10 per cent a year, whereas growth in the number of people heading overseas has halved to just 3 per cent.

The boom in tourism is important because it represents the rise of the broader services sector. Tourism also creates jobs in industries like hospitality, but such has been the surge in tourism that it’s also unleashing its own investment boom.

As businesses jostle to cater to the new wave of arrivals, the pipeline of potential resorts and the like has jumped to almost $20 billion, according to estimates from Deloitte Access Economics.

Airlines are also opening new routes to Asia—Qantas restarted direct flights to Beijing recently—and some in the business are calling for tourist infrastructure such as airports to be upgraded.

 

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