China offers enormous potential for WA in terms of tourist numbers. But has the state missed the boat?
Premier Alan Carpenter’s desire to increase tourism from China to Western Australia is welcome news indeed, but perhaps the government is six years too late.
In 1999, Australia became the first Western nation to be granted Approved Destination Status (ADS) from the Chinese Government, but today there are nearly 100 countries scrambling to attract Chinese tourists and their airlines.
And not only does WA have to compete with 100 other countries, but Queensland is emerging as a formidable competitor in scramble to attract Chinese tourists.
China Southern Airlines, Tourism Queensland and the Brisbane Airport Corporation have formed a working group to further discuss the airline’s interest in operating from Guangzhou to Brisbane.
Shanghai-based China Eastern and Shanghai Airlines have both expressed interest in a non-stop service from Shanghai to Brisbane, according to Queensland Premier Peter Beattie.
Air China, China Southern and China Eastern – often referred to as the ‘big three’ – only operate to Sydney and Melbourne.
Outbound Chinese travel is booming, growing at 15 per cent a year, with 300,000 Chinese visiting Australia last year.
And while Premier Carpenter wants direct flights, achieving this goal will not be easy as Chinese tourists flock to Europe, which gained ADS status in late 2003.
Already millions of Chinese are flocking to Europe; and not just Paris and Rome but Vienna, Prague and Budapest. These cities are chasing a potential 100 million Chinese visitors by 2020.
What makes Chinese tourists so special is not only the numbers but their spending habits. According to a report from Goldman Sachs, the amount spent by the average Chinese tourist is now slightly higher than that by the Japanese.
China is Australia’s fifth largest source market in terms of visitor spend, with Chinese visitors spending $1.35 billion on trips to Australia in 2004.
According to Global Refund, an international tax refund service, Chinese recorded a growth of 41 per cent in tax-free retail spending from January to November 2005 compared with the same period in 2003.
Shen Huirong, director of the Tourism Promotion and International Liaison Department of Chinese National Tourist Association (CNTA), says that China’s tourism sector will grow by 10 per cent each year.
Wei Xiao’an, a researcher with the Travel Research Institute of the Chinese Academy of Social Sciences, told China Daily that figures from the World Travel and Tourism Organisation indicated that, in 2020, China will be the world’s fourth-largest source of outbound tourists.
In 2005, 31 million Chinese travelled overseas and this year that number is expected to top 40 million, with Australia attracting less than 1 per cent although that equates to 8 per cent of visitors to Australia.
The challenge for the government and Tourism Western Australia is significant – non-stop flights are critical to bolster the number of Chinese tourists but Chinese airlines are focused on US and European destinations.
Premier Carpenter was misquoted in local media suggesting that he would talk to Cathay Pacific Airways about direct flights. Cathay Pacific, a long-time supporter of WA, operates four services a week into Perth from Hong Kong but cannot operate from any other Chinese destination to Perth.
The airline recently reached a new accord with fellow shareholders in Hong Kong-based Dragonair to take over management of the airline, which will result in through fares onto Dragonair’s comprehensive China domestic network.
Mr Carpenter did visit Cathay Pacific’s executives in Hong Kong but this was more to advise the airline of the state’s intentions to seek direct services.
He told media: “Like the Japanese, the Chinese would rather have a direct route to WA than having to change planes. Clearly, if we could achieve this, the numbers of Chinese people visiting WA would grow considerably.”
Tourism WA is working hard to lure Chinese tourists. So far this year, two groups of Chinese travel agents – one hosted by Singapore Airlines – have visited WA for five-day familiarisation talks, according to CEO Richard Muirhead.
Each year, the state’s familiarisation program hosted about 1,200 high-profile travel journalists, travel agents, international tourism wholesalers and airline holiday consultants.
“The state government invests more than $500,000 annually into this program. It is strongly supported by the tourism industry, which offers $2.6 million in cash or in-kind support, including through air travel, accommodation, car hires, meals, tours and the like,” Mr Muirhead said.
“In return, the Media and Trade Familiarisation Program generates media exposure worth hundreds of millions of dollars for the WA tourism industry.”
For the WA Government, the best bet – at least in the near term – is to work closely with Cathay Pacific and Singapore Airlines to develop airfare/hotel packages to Perth.
Qantas is a late starter in China. It re-launched flights from Sydney to Shanghai in late 2004 and Beijing this year. From Perth, however, Qantas operates three flights a week to Hong Kong on the days Cathay does not operate.
That service only started in 2004.
Before the recent outbreak of Sars, Qantas operated a daily flight to Hong Kong via Singapore.
Singapore Airlines offers a range of options though Singapore, with its almost three-times-daily flights from Perth.
The airline operates three times daily to Beijing, daily to Guangzhou, five times daily to Hong Kong and four times daily to Shanghai. Singapore Airlines also operates to Nanjing, Chengdu, Shenzhen and Xiamen.
