Chinese tourists, once a mainstay of Australia’s economy, are staying close to home due to visa rejections, high costs and no resumption of tour groups

Tourism Australia will launch a Come and Say G’day campaign in China next month. Trade

Tourism Australia will launch a Come and Say G’day campaign in China next month. Trade and Tourism Minister Don Farrell told AFR Weekend he hoped the campaign would encourage Chinese travellers to think beyond domestic trips.

On Thursday, China lifted a ban on Australian timber imports, and the Albanese government is hopeful it can also resolve trade disputes related to barley and wine.

Mr Farrell did not directly respond to Australia’s absence from the Chinese government’s approved destinations for overseas group tours, which was expanded by 40 countries in March to include Nepal and Iran (but exclude neighbours Japan and South Korea).

‘China is so important’

Chief executive of the G’day Group Grant Wickens said the Australian tourism industry longed for “a good trading relationship with China, be it wine, lamb or tourists”.

“China is so important to our tourism industry – the No.1 foreign tourist source pre-COVID,” he said.

Before the pandemic, Chinese guests made up about 15 per cent of all tourists to G’Day Group’s resorts such as El Questro in the Kimberley.

Holidaymakers in China say they are desperate to come after three years of living under tight lockdowns, but there are too many obstacles. Travel agents complain Australia is knocking back visa applications, there are not enough flights, and Australia is expensive.

There were early hopes China’s high-spending tourists would flock back to Australia. But the latest Australian Bureau of Statistics data shows Chinese visitors are a fraction of the level in 2019.

There were 26,810 short-term visitors from China in March compared to 124,370 in March 2019. The number in February, when the Lunar New Year holiday spurred on travel, was 40,430.

Once Australia’s largest source market for tourists and a mainstay to the economy, with spending peaking at $12.4 billion annually before the pandemic, China in March ranked sixth behind New Zealand, the United Kingdom, the United States, India and Singapore, and was almost level with Japan.

Those who make it to Australia like what they see, and say tourists have not been put off by years of diplomatic tensions and negative stories in the media.

“I hugged koalas and swam with sea lions. My only complaint was that 10 days was not enough to see everything,” said Wang Xiaomei, a 27-year-old teacher from Nanjing who rented a car and drove from Sydney to Adelaide last month.

“The diplomatic and trade relations between the two countries will have an impact on tourism to Australia, but not severe. Australia has always been a very popular destination for Chinese students and travellers.”

However, Ms Wang’s case is rare. Despite pent-up demand for travel by Chinese consumers, most tourist dollars are being spent domestically. Travel numbers within China were 20 per cent above pre-pandemic levels during the May Day holiday earlier this year.

Slow-burn return

The tourism industry globally hopes it is a slow burn and the masses will regain a taste for long-haul travel as flight capacity increases. Tourism Australia shares that sentiment, with its research predicting visitor arrivals from China growing back to pre-pandemic levels by 2026.

“While we never expected visitation numbers from China to bounce back overnight – based on what we have seen from other international markets – we are encouraged by what we are seeing with the return of Chinese travellers this year,” Tourism Australia managing director Phillipa Harrison told AFR Weekend.

“Importantly, we need aviation capacity to build back up to convert this demand into an Australian holiday, and that is forecast to return to more than 50 per cent of 2019 levels mid-year, with further increases expected in the second half of 2023,” Ms Harrison said.

For the time being, Chinese tourists are staying close to home, which means Australia is seen as a stretch too far even though it is in the same time zone.

Travel giant Ctrip told AFR Weekend that flight ticket data showed almost 70 per cent of outbound travel was concentrated in South-East Asia. The top destinations during the May Week holidays were Hong Kong, Bangkok, Macau, Singapore, Phuket, Seoul, Tokyo, Kuala Lumpur, Osaka and Taipei.

One obstacle for some is getting a visa to travel to Australia. Chinese immigration agency the Aosheng Group said in a social media post that Australia had rejected as many as 600 tourist visa applications since borders reopened. It said this was because there had been a sharp increase in the number of Chinese visitors staying illegally in Australia after their tourist visas had expired.

It also blamed the ban on tour groups, high costs, a shortage of flights and expensive airfares, and too few Mandarin-speaking tour guides.

“Although Australia is not in the list of countries for group tour resumption, the number of people making inquiries or applying for visas is increasing,” Jia Jianqiang, CEO of 6renyou, an online tourism agency in Beijing, told the Global Times.

“We have also been trying to spark interest among clients and are actively making business preparations so we can start Australia-bound tourism.”

Chinese social media posts also suggest some travellers are having tourist visa applications knocked back. “I don’t know why it is so hard to get a travelling visa to Australia,” one man contacted by AFR Weekend said.

The Australian Department of Home Affairs was contacted earlier this week for comment but did not respond by deadline. Tourism Australia declined to comment.