Tourism funding welcome but export supply chain remains vulnerable

Published on : Tuesday, September 29, 2020

The Australian Tourism Export Council (ATEC) today welcomed the Government’s announcement of additional funding for the tourism industry but remains concerned by a lack of specific funding to support the businesses which deliver international visitors to Australia.

The package announced today will bring some desperately needed support to major, mostly internationally focused, tourism businesses across regional Australia but support is still needed to ensure the inbound tour operators (ITOs) who supply international visitors to these areas survive.

“ITOs are essential to the export tourism supply chain and are a vital part of the fabric of our connection to the global tourism marketplace,” ATEC Managing Director Peter Shelley said.

“Without ITOs many of these regional tourism businesses would have never had the level of international visitation that has helped them to build their product and if ITO businesses disappear, the long term viability of these regional tourism businesses is questionable too.

“Right now support to enable tourism businesses to better connect with domestic visitors will be very welcome but their previous success was built on having a mix of international and domestic visitors with international visitors making a stronger contribution to the bottom line – they simply stay longer and spend more.

“Australians just don’t travel the same way or spend on the same things as international visitors and in the long run these businesses will need to turn back to their international market for survival and they will typically do this in partnership with inbound tour operators, their international distribution partners.

“The export tourism industry has a complex supply chain which relies on business relationships which have been forged over decades and ITO businesses have been the platform on which Australia has grown its annual tourism export earnings to over $45bn annually.

“We know many of our regional tourism supplier members will be very happy to see this funding, but there remains many gaps in the solution and many tourism businesses will still be looking for help. Businesses in metropolitan areas which have seen their business grind to a halt, ITOs which have had no income since February and those businesses which fall outside of the funding guidelines. Twelve months ago they were all viable and today they face extinction through no fault of their own.”

Mr Shelley said the funding will be welcome in the short term but will be quickly exhausted given the extent of need within the industry. ATEC has been calling on the Government to establish a long term, well-funded strategically focused tourism resilience fund which will provide layers of support to assist recovery and restart of our industry over the next 3 years.

“Earlier this year we saw the Government announce a sizeable $1bn fund for tourism as part of its initial COVID stimulus package, funding which was quickly allocated to supporting large infrastructure like regional airports.

“While we recognise the importance of these priorities, many tourism businesses are struggling to survive and many have completely shut down their operations, exasperated by the uncertainty of state border closures.

“Over the past decade Australia’s export tourism industry has delivered more than $350bn in export earnings to our economy and this success has supported one in 12 jobs and has been the lifeblood of many regional communities.

“Recognising the importance of international visitors to the future of regional tourism operators ATEC continues to urge the Government to directly address the survival of the ITO sector and look to provide support in the upcoming Federal Budget.”

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