Interest Rate Hold Positive for Tourism
“Steady interest rates will be a positive sign for the tourism industry, especially if it takes the pressure off disposable income in time for our peak holiday season, said Tony Charters, the convenor of the inaugural Tourism and Events Excellence conference in Melbourne, 5 – 7 September.
He said Roy Morgan Research shows the tourism industry believes the strong Australian dollar is the most critical issue it is facing but that is misguided.
“The most significant financial factor impacting Australians’ holiday spending is actually interest rates not the exchange rate,” said Mr Charters.
“Roy Morgan Research data over the past decade shows Australians’ propensity to take an annual holiday directly tracks interest rate movements. When people can afford to take a holiday they are increasingly choosing an overseas destination over a domestic one, despite the exchange rate fluctuating frequently over the same timeframe. This debunks the exchange rate as a prime influence on people’s holiday plans.
“The key message is the Australian industry has to look at the marketplace with fresh eyes and shape up.”
Australian tourism cannot hide behind the buoyant dollar and must face up to product and service quality issues if it is to regain profitability according to an industry veteran looking to redirect the industry. Mr Charters said the new conference was about refocussing the industry for the 21st century landscape which is far more competitive and demanding than the hey days of the Paul Hogan campaign.
“It is unacceptable that Australia still relies on New Zealand – a country of less than 4.5 million – as the biggest source of international visitors,” said Mr Charters. “The industry must face up to the new realities and do better. We can’t rely on most Australians holidaying at home anymore, and we have actually known for a long time that Australia is a highly desirable destination for people from all around the world, but it is too far away for many markets.
“While traditional markets will continue to be important, the rising middle classes in a China and other countries close to our time zone offer more realistic potential.
“Australia has to have the products and the service to respond.”
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