Reforms in Australia's Tourism Industry: An Overview

Running head: ECONOMICS FOR BUSINESS
ECONOMICS FOR BUSINESS
Name of the Student
Name of the University
Course Id

1ECONOMICS FOR BUSINESS
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

2ECONOMICS FOR BUSINESS
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.

3ECONOMICS FOR BUSINESS
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