Chinese visitors to reach pre-pandemic levels by year’s end as federal government allows group travel to resume

The Albanese government has recommenced the visa process for Chinese group travellers, effectively removing the final

The Albanese government has recommenced the visa process for Chinese group travellers, effectively removing the final hurdle that was limiting tourism to Australia, but the industry is concerned that there aren’t enough flights to keep up with demand.

Tourism Minister Don Farrell said it will be a major boost to tourism and expects travel from China to bounce back by Christmas.

“China is terrifically important to our tourism sector,” he told The Business.

“Pre-pandemic, China was our largest source of tourism, worth about $12 billion to the Australian economy.”

The Approved Destination Status (ADS) visitor visa allows Chinese tourists from some parts of China to travel to Australia in guided groups.

They made up more than a third of total holiday arrivals from China and had spent about $581 million in Australia in 2019.

A man wearing a blue suit stands in an office.

Don Farrell says he encourages Chinese airlines to increase flights into Australian cities.(ABC News: David Frearson)

Mr Farrell said he expects that by year’s end “we’ll be back up to where we were pre-pandemic”.

China lifted a ban on group tours to Australia in August, which some say contributed to a thawing relationship. 

Chinese tourism rebounds by 111pc due to ‘pent up demand’

The latest ABS data shows there has been a rebound in Chinese tourism.

Short-term arrivals from China increased 111 per cent in July (79,040) compared to the previous month (37,330).

That makes China the second biggest source of international arrivals after New Zealand.

China was Australia’s largest and most valuable inbound traveller market in 2019, with 1.4 million holiday makers spending $2.1 billion that year.

A man wearing a uniform stands in front of a bus, crossing his arms and smiling.

Benny Pan says he is ready to welcome Chinese tour groups back.(ABC News: John Gunn)

Veteran tour guide Benny Pan has been working around the clock since mid-year to service their return.

“We are very busy every day,” said the 55-year-old, who’s been working in the tourism industry for two decades.

“There are more Chinese tourists coming back than expected.”

Mr Pan said his company recently purchased six new buses to prepare for a busy season in the lead up to a national holiday in October and the 2024 Chinese New Year.

The return of Chinese tourists comes after the launch of $125 million Come and Say G’day campaign in China in late June.

Mr Farrell said “there’s a lot of pent-up demand in China”.

“Already we’re getting heaps of interest in travel whether it’s individual travel or group travel, which now is available to the Chinese tourists,” he said.

“We never stopped advertising into China, even during the pandemic, because we knew that at the end of the process, there would still be a lot of interest in coming to Australia and that’s proven to be true.”

Prime Minister Anthony Albanese’s visit to Beijing later this year is likely to further improve travel between the two countries.

The Australian tourism sector endured a deep freeze from China as the bilateral relationship deteriorated during the pandemic over disputes regarding trade, the origins of COVID-19, human rights and national security.

A woman smiles at the camera

Margy Osmond is the chief executive officer of Tourism & Transport Forum.(Supplied)

Industry boss Margy Osmond said the improving relationship will encourage more Chinese tourists to travel Down Under, but it may be hard to keep up with demand.

“I think a lot of this will be about aviation capacity. We really need those seats to put the bottoms on to get people here,” she said. 

According to data from Tourism Australia, flights from China to Australia are back to 73 per cent of pre-pandemic levels as of August. It is expected to reach 79 per cent by the end of this year.

But as tourists return we may not have enough flights or tour guides

Ms Osmond said many businesses that had serviced Asian and Chinese travellers before the pandemic had now moved to other industries.

“The trick for us is going to be getting back up to speed to provide the right cultural customer experience for people coming from China,” she said.

A man stands near a lake.

Geoffrey Thomas is the editor in chief of News: Greg Pollock)

Aviation analyst Geoffrey Thomas said airfares were 30 to 50 per cent more expensive for Chinese travellers.

“The primary one [issue] is the shortage of capacity as airlines are still bringing aircraft back into their networks,” he said.

“The other issue is inflation. Fuel prices going up, shortage of spare parts for aircraft.

“There’s all sorts of dynamics that are driving up the price of travel. I think it’ll be another 12 months before we get anywhere near the pricing levels of 2019.”

A Chinese family posing to camera, smiling.

Australia is currently competing with 77 other countries for the China market.(ABC News: John Gunn)

But despite experts calling for more flights from China into Australia, consumer watchdog the ACCC has proposed to end a partnership between Qantas and China, which allows the two airlines to co-ordinate passenger and cargo transport operations. It believes the alliance may breach competition laws.

Qantas is planning to resume direct flights between Sydney and Shanghai in late October.

Mr Thomas said if the proposal goes ahead, it will not impact aviation growth overall but may inconvenience Qantas passengers.

“Strictly speaking, it is a monopoly situation,” he added.

“But there are very competitive airlines either side that can offer a really good fare into Shanghai that will produce price competition for these two carriers.”

With China’s economic slowdown and more Chinese tourists choosing to travel domestically, that might pose a challenge for global tourism recovery.

Watch the story on The Business tonight at 8:45pm AEST on ABC News Channel, or stream on ABC iview.