Emerging Asian economies likely to have flow-on-effect for Australian tourism industry

Tourism from Indonesia and Malaysia is expected to rapidly rise by 2015, while the number Australians holiday overseas is showing signs of easing, a survey has found.

Deloitte Access Economics corporate finance director Lachlan Smirl said a cashed-up middle class in emerging economies throughout Asia is likely to have a flow-on-effect for the Australian tourism industry.

“Proximity is a major driver of travel patterns and Australia’s proximity to Indonesia, coupled with the fact that it is well serviced by low cost carriers, is a key driver of the growth in inbound visitation from Indonesia,” Mr Smirl said.

“Income growth is also an important driver of travel and on that front the outlook for Indonesia is also strong, with projected growth in real GDP (gross domestic product) of between six and seven per cent over the next three years.”

Visitor arrivals from India, China, and Indonesia are forecast to grow by about seven per cent over the next three years, while Malaysians arrivals are expected to grow by 4.3 per cent.

The Deloitte’s Tourism and Hotel Outlook for the third quarter of 2012 found that there was a spike in domestic trips in the March quarter, and that hotel room occupancy continued to trend at all-time highs.

“There is an increasing awareness that a number of capital cities are at breaking point and that, given current commercial conditions do not favour investment in hotel accommodation, measures will need to be taken to encourage and facilitate hotel investment,” Mr Smirl said.

Finding an available hotel room on weeknights on the East Coast is likely to remain difficult, with occupancy rates expected to increase to 88 per cent in Sydney and to 84.6 per cent for Melbourne in 2015.

Perth continues to have the highest room occupancy in Australia largely as a result of the resource boom, trending at 86.2 per cent last quarter.

Tropical North Queensland is slowly recovering from the after effects of cyclones and flooding during a tumultuous 2011, but room occupancy rates are yet to reach their historical highs.