Australian tourism facing disaster: ATEC

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June 5, 2008

Qantas’ decision to slash international air services to Japan demonstrates the extent of the disaster confronting the Australian tourism industry in the next twelve months due to fuel price increases, according to peak industry body the Australian Tourism Export Council (ATEC).

ATEC Managing Director Matt Hingerty said that the Qantas air-service cuts, and its decision to close its Cairns pilot base are just the latest in a long line of factors which have Australia’s export-earning $24 billion inbound tourism industry in crisis.

Mr Hingerty called for a rescue package, including direct financial incentives for Australians to take a holiday within Australia, as occurred after September 11 and the collapse of Ansett.

“The situation is desperate – it is likely we are going to see numerous small tourism businesses go to the wall,” Mr Hingerty said.

“The industry has not been crying wolf about this issue, and this decision by Qantas to cut services shows how grim things are getting.”

Mr Hingerty said that Australian Bureau of Statistics figures being released tomorrow demonstrate a continuing decline in visitor numbers from key tourist markets, and are direct evidence of the industry’s malaise.

“Between Federal tax rises on travellers, the high dollar, soaring prices for petrol, food and other business inputs, the tight labour market, high interest rates and more competition overseas, the tourism industry is facing the toughest trading conditions since September 11 and the collapse of Ansett,” Mr Hingerty said.

“We have seen a deluge of tourism strategies from all sorts of governments, but we don’t need more process – we need immediate and direct financial aid. Governments have been living off the fat of our endeavours through the GST we harvest, and other taxes and charges, and it is time they put something back.”

Mr Hingerty said $50 million over and above what was promised during the Federal election should immediately be injected into the Export Market Development Grants Scheme to help businesses to trade their way out of trouble.

Mr Hingerty also called for an immediate increase in each State’s tourism marketing budget, as well as for the immediate release of the O’Neill Report into the NSW tourism industry with the $20 million extra in marketing dollars that the industry has called for.

Mr Hingerty said that the Federal Government must waive its planned tourism tax rises for at least twelve months, and as an interim measure should provide direct financial incentives for Australians to take holidays in Australia during the July holiday period.

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Contact: Nick Buchan              
National Media and Communications Manager
Ph: 02 8262 5501
Email: nick.buchan@atec.net.au