Reforms in Australia's Tourism Industry: An Overview

This report provides an overview of the reforms in Australia's tourism industry over the last few years. It includes measuring the tourism industry, the role played by the Australian government, and recommendations for improvement. The report highlights the contribution of the tourism industry to the Australian economy and employment. It also discusses the changing composition of Australia's foreign visitors and the role of digital technologies in the tourism sector. The report recommends that the Australian government should focus on understanding consumer preferences, decrease barriers to investment in infrastructure, improve transport facilities, increase the use of digital technologies, address labor shortages, and focus on raising output, quality, and innovation.

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Table of Contents
Introduction......................................................................................................................................2
Measuring tourism industry in Australia.........................................................................................3
Reforms in Australia’s tourism industry..........................................................................................5
Recommendations on the policies to be adopted by the Australian government..........................11
Conclusion.....................................................................................................................................12
References......................................................................................................................................13

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Introduction
The report provides an overview on the reforms in tourism sector of Australia over the
last few years. It mainly focuses on the rising tendency for the Australians to visit overseas and
compositional reforms in inbound visitor market that contributes to increased growth in tourism
sector in present years. The tourism sector is one of the main contributors of overall level of
employment and economic activity in Australia. This industry contributes to about 11% in GDP
(gross domestic product) of the Australian economy. The contribution of this tourism industry to
total employment of this economy was near about 5% during the year 2014-2015. Both
international and domestic tourism is the vital part of this sector, thereby representing 73% of the
direct tourism (Amelung and Nicholls 2014). In fact, a total of 7.4 million domestic and
international tourists have contributed to near about 8% in export earnings during the past few
years. Demand for Australia’s international tourism has grown considerably over the last few
years. The total number of foreign tourist travelling to this economy increased more than double
over the last few decades. The increasing number of visitors, decline in prices of air fare and
relative tourism price in this nation has been lesser than other nations. In the present years, the
total share of tourists has declined marginally. For enhancing the share, the Australian
government made specific level of investment and introduced reforms in the tourism sector. The
measurements of this nation’s tourism industry are also analyzed in this report. This study
provides a discussion about the role played by the Australian government in introducing reforms
in this industry. Furthermore, recommendations to the Australian government are also provided
regarding improvement of their tourism industry.

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Measuring tourism industry in Australia
Tourism industry is one of the unique industries where output is usually determined by the
consumption expenditure, involving- spending of visitors. Estimation of tourism spending
mainly requires identification of visitors as well as their expenditure patterns. However, the ABS
(Australia Bureau of Statistics) has published TSA( Tourism Satellite Account) in the country
that provides significant detail on this nation’s tourism sector. Particularly, annual TSA mainly
measures direct contribution of this industry to the Australian economy by aggregating output of
each sector which is consumed by tourists. The output of tourism is thereby brought into national
accounts structure as composite of total output of defined sectors. The tourists in TSA are usually
defined are as the tourists travelling to a specific region of this country for less than a year,
which is outside of geographic environment. Moreover, measures of the tourism output are not
only restricted to expenditure on leisure activities but also involves expenditure on travel for
education, business and other events. The data revealed by TSA reflects that the total output of
tourism has increased at high rate over the past few years. It also highlights that this industry‘s
total contribution to employment also increased over the years. It has been found out that the
total number international tourists increased more than domestic tourist over the past few years.
Figure 1:Total number of tourist arrivals in Australia

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Source: (tradingecoomics.com 2018)
Role played by the Australian government in tourism industry
The government of Australia plays a major role in the bringing about improvement in the
tourism industry. The policymakers are mainly involved in several activities which directly
impact the international tourism sector. The Australian government supports international
tourism sector through provision of various destination marketing for promoting Australia and
also through funding of cultural as business events. In addition to this, government tourism
agencies such as “ Tourism Australia” also plays vital role in managing various activities relating
to tourism. These agencies are mainly involved in provision of research relating to tourism such
as-compilation, collection, dissemination of data. The total expenditure of these tourism agencies
are mainly provided by the Australian government (Productivity Commission research paper
2018). The Australian government plays a vital role in the border processing since 99% of
foreign visitors arrive in this nation by air. Investment in few areas including transport
infrastructure, accommodation are vital for facilitating international tourism in this country.
However, the government plays the crucial role in providing infrastructure related to tourism in
order to assure that regulatory frameworks do not create unnecessary barrier in private
investment in the area. Thus, the government acts as main contributor monetarily for
development of tourism in this nation. In addition to this, they also deal with several issues as
well as policies for operating in smooth acceleration of this sector. They have introduced several
reforms over the years in order to boost this sector as well as enhance its contribution to GDP of
Australia. They array reforms that are being implemented in the tourism industry gradually. They
aim at motivating regional tourism and attract international tourists for visiting this nation’s
regional areas. The policymakers are mainly concentrating on funding in marketing of this nation

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and also support business events for attracting international tourists. Through recognition of
accreditation schemes, the Australian government aims to remove huge licensing regimes in
order to improve business enterprises of travel and tourism (Productivity Commission research
paper 2018). They also make reforms in Competition and Consumer Act (CCA) in order to
increase protection for international tourists and target demographics to highest standard. Apart
from this, the federal government of this nation also injects liquidity in the industry for
enhancing development. The government of Australia introduces new initiatives for promoting
the domestic tourism through online platform. They have introduced digital marketing tool for
promoting tourism business in this nation across the globe. In fact, new reforms had been made
in Travel agents Repeal Bill by the Australian government for promoting tourism across the
regions of this nation.
The commission takes initiative in the research project for examining trends as well as
drivers of huge growth in tourism industry in this nation with the view to understand various
implications for the government policies. Moreover, the commission takes interest in the
Australia tourism sector in order to assess the Australian government role in the tourism sector
and also considers whether there are any barriers in future growth in tourism in this nation which
are amenable to policy reforms.
Reforms in Australia’s tourism industry
Several reforms in the Australia’s tourism sector have occurred over the past few years,
which in turn improved its contribution to GDP. The contribution to Australia’s employment also
improved during the past five years even though it declined in the year 2017.There has been
huge reform in the total composition of this nation’s international visitors over the last few

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decades. This changing composition of Australia’s foreign visitors in this country has been
mainly driven by several factors that includes – increasing household incomes in several Asian
nations as well as lower airfares that facilitated to provide larger international travel. It has been
pointed out by few economists that, increase in total number of foreign visitors in this country
led to increase in economic growth of Australia. In addition to this, there has huge advancement
in the larger utilization of digital technologies in this tourism industry. For example, a huge
number of foreign travelers now-a-days doing research about the tourism products including-
accommodation, air travel through internet( Moyle, Weiler and Croy 2013) It has been evident
from few studies that the total proportion of foreign visitors attaining information on internet
increased from near about50% to 60% and total proportion of foreign visitors booking part of
travel online enhanced from 22% to 50%. Thus, rising utilization of internet has changed the way
individuals travel across the globe. But this growth in utilization of digital technologies have
huge implications for the traditional service providers , which involves- travel agents and thus
have increased policies as well as regulatory issues for the governments. Besides this, the
infrastructure of the tourism sector of this nation also improved as well. This in turn helps the
tourism industry to attract large number of international as well as domestic visitors across the
globe. It has been evident from recent studies that there has been change in the visa application
procedure, which in turn increased the demand of tourism sector in this nation. Recent evidences
reflect that previously visa application procedure in Australia has been too cumbersome as well
as demanding in comparison with other nation’s visa application procedure
(Tourism.australia.com. 2018). However, with advent of China being the main gateway for
foreign visitors to this nation, the Australian government tried to improve the process of visa
processing in order to attract more tourists. Reforms in this tourism industry have led to increase

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in total employment level of this country. According to the figures released by the ABS
(Australian Bureau of Statistics) that the this industry providing employment to the individuals
mainly accounted for 8% of this nation’s employment figures. Few facts reflect that there are
several vacancies in job that are not filled up after bringing about reforms in this sector. The
destination marketing that has been provided by the Australian government and state as well a
territory government led to huge economies of scope. However, the benefits of this destination
marketing mainly flowed to the businesses that are related to tourism.
Figure 2: Contribution of tourism in Australia’s GDP
Source: (Travel and tourism economic impact 2017 Australia 2018)

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Figure 3: Contribution of tourism sector to employment
Source: (Travel and tourism economic impact 2017 Australia 2018)
The Australian government has taken few economic reforms in order to create
transparency within the tourism sector. Furthermore, these reforms have been adopted to create
confidence among investors as well as stakeholders. These reforms also facilitate the Australian
government in increasing funds for development of tourist spots in the nation (Rba.gov.au.
2018). In addition to this, these reforms have been undertaken for ensuring compliance with
Australian consumer law. The reforms that have been made for tourist agents also facilitate to
attain competitive marketing advantage to market leaders in tourism sector in this nation. In
addition to these, the reforms also aid to maintain flexible regulations of government than
previous legislations. This also helps the policymakers to have better monitoring system as well
as quality control within this industry. The reforms in these policies implemented by the
Australian government also help to provide complaint handling system which might be accessed
over digital platform. This complaint handling system benefits the government by being costs

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effective, time saving and user friendly. Moreover, these can be observed that these reforms have
been made by the Australian government after conducting review of their tourism sector (Dwyer
et al. 2013). These reforms have been necessary for promoting tourism in this nation as well as
attract tourists from around the world. Presently, it has been evident that necessary reforms
which have been made in Australian government policies facilitated the tourism industry to
grow. The improvements occurred in this sector also encouraged market rivalries to explore huge
opportunities in fair way. Apart from this, these reforms also helped to open up several
dimensions as regulatory measures becomes highly active. Invariably, it also aid to set up high
standards of services towards international clients. Moreover, adoption of regulatory measures
by the government also helped to stop probability of deception that protects rights of
international tourists. It has been found out by some researchers that the affirmative change
which have been directed towards tourism sector of this nation also helps to build good
relationships with the foreign tourists.
The Australian government has launched Tourism 2020 sector potential for bringing about
more reforms in the tourism industry of this nation. Tourism 2020 has been developed by the
policymakers of this country in order to respond to the preset issues and opportunities occurring
for this tourism sector. It mainly focuses over six vital areas that are explained below:
 The policymakers are required to form reforms for understanding consumer preferences
as well as taste, strategize marketing campaigns and also improve their policies regarding
tourism in order to capture increasing international visitation especially from the Asian
nations (Swanson and Edgell 2013).
 Some of the regulatory norms have been dispersed unequally such that the investors from
across the globe do not take interest in making investment in infrastructure of tourism.

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The Australian government is trying to introduce reforms regarding decrease in barriers
as well as assure more development of infrastructure according to the visitors demand.
 It has been opined by Mistilis, Buhalis and Gretzel (2013) that , tourism in any nation
will enhance if transport facilities as well as local movements are properly developed
such that people can move within this nation. Therefore, the Australian government has
been entering into different ventures with several business houses in order to raise
transport facility as per demand of tourists.
 Although there has been advancement in digital technologies within this tourism sector, a
small portion of the Australian service providers are utilizing these technologies for
booking tickets as well as accepting payments. However, this makes restrictions on their
ability to cater domestic and international visitors. Therefore, the government of this
nation has been trying to work upon this such that larger number of the tourism
organizations takes opportunities of doing business internationally.
 It has been evident from recent facts that there has been deficiency in laborers of the
tourism industry in this nation. However, the policy makers are thereby required to
formulate various reforms in order to assure that dequate hiring of skilled workers are
done by this industry (Ma and Hassink 2013).
 Furthermore, the government of this country is also needed to work on their tourism
sector on order to raise total output, quality and innovation.
Recommendations on the policies to be adopted by the Australian government
Even though the reforms introduced by the Australian government has increased the growth
of the tourism industry in this nation, there are few recommendations that are provided by the
commission-

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 There are some situations in which the Australian government gets involved in provision
of infrastructure of tourism such as infrastructure which are given on public land. In such
situation, the government should need to take into account reform of funding
arrangement and project selection (Swanson and Edgell 2013).
 The funding of Australian government to local and state government must be conditional
on practice investment principles that are being implemented.
 The government as well as tourism industry should work together for implementing
workforce development plan, which mainly takes into account migration, demographic
change, different range of skills of tourism workforce.
 The government should develop high powered research capability for determining
demand as well as supply side research needs. Moreover, the research capacity must
include transport, accommodation and so on.
 The tourism sector must be adequately resourced as well as focused mainly on delivering
national tourism strategy, objectives and targets. However, the government of this
country must refocus on the supply side problem and visitors demand for long term
growth of tourism.
Conclusion
From the above discussion, it can be concluded that reforms in the tourism industry in
Australia led to increase in tourists visiting this country across the globe. The rising propensity
for the Australians to visit overseas has mainly brought about vital changes in pattern of demand
for tourism in this county over the last few decades. Owing to change in behavior of travel and
increasing globalization of travel, the tourism sector of this nation has become more focused on
exports mainly for emerging markets. Furthermore, it has been evident that the conditions in

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several other parts of this sector including leisure market destinations might remain difficult in
the future.

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References
Amelung, B. and Nicholls, S., 2014. Implications of climate change for tourism in
Australia. Tourism Management, 41, pp.228-244.
Dwyer, L., Forsyth, P., Spurr, R. and Hoque, S., 2013. Economic impacts of a carbon tax on the
Australian tourism industry. Journal of Travel Research, 52(2), pp.143-155.
Ma, M. and Hassink, R., 2013. An evolutionary perspective on tourism area
development. Annals of Tourism Research, 41, pp.89-109.
Mistilis, N., Buhalis, D. and Gretzel, U., 2014. Future eDestination marketing: perspective of an
Australian tourism stakeholder network. Journal of Travel Research, 53(6), pp.778-790.
Moyle, B.D., Weiler, B. and Croy, G., 2013. Visitors’ perceptions of tourism impacts: Bruny and
Magnetic Islands, Australia. Journal of Travel Research, 52(3), pp.392-406.
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https://www.pc.gov.au/research/completed/international-tourism/international-tourism.pdf
[Accessed 21 May 2018].
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2018].
Swanson, J.R. and Edgell Sr, D.L., 2013. Tourism policy and planning: Yesterday, today, and
tomorrow. Routledge.

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Tourism.australia.com. (2018). Tourism 2020 - About Us - Tourism Australia. [online] Available
at: http://www.tourism.australia.com/en/about/our-organisation/our-performance-and-reporting/
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arrivals [Accessed 21 May 2018].
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https://www.wttc.org/-/media/files/reports/economic-impact-research/countries-2017/
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Vanhove, N., 2017. The Economics of Tourism Destinations: Theory and Practice. Routledge.