Investment in Australian Tourism Sector

Australia, renowned for its exceptional safety and stability, holds a prominent position as one of the world’s most secure nations. In recent years it has captivated significant international attention, consistently ranking as a top choice for foreign direct investment and attracting highly skilled individuals from around the globe1. With a robust currency, political stability, and a secure and thriving business environment, Australia offers a reliable haven for low- risk investments. 2023 has seen a rise in domestic and foreign investors exploring exciting and reliable avenues for engaging with the Australian economy.

With its breathtaking landscapes, vibrant cities, and rich cultural heritage, one of Australia’s most appealing investment opportunities has emerged in the global tourism sector. Boasting a strong and resilient industry, the Australian tourism sector has long been recognized for its potential to deliver substantial returns to foreign investors. In this article, we will delve into the thriving Australian tourism landscape, highlighting its key strengths and exploring the lucrative opportunities that await investors seeking to capitalise on this dynamic market.

Australia stands out as a premier investment destination long renowned for its stability and low-risk profile. For investors seeking secure growth and geo-political simplicity the tourism sector presents accessible and favourable investment avenues within the Australian economy, with government initiatives specifically catered to increasing international investor-friendly policies. According to the World Economic Forum (WEF) the nation boasts a robust banking system that ranks among the most reliable globally2. Transparent markets coupled with effective regulatory measures create an ideal environment for preserving and expanding wealth. Furthermore, Australia anticipates substantial population growth throughout the coming decades, complemented by a prosperous and highly educated workforce. As a result, the Australian economy is poised to thrive, offering abundant opportunities for economic success.

According to Tourism Australia, the official tourism organisation of the country

Echoing this sentiment, the Department of Foreign Affairs and Trade emphasises the government’s commitment to promoting industry growth and creating an investment- friendly environment. Their message to foreign investors is clear:

The Australian tourism sector benefits from a strong regulatory framework backed by the Australian government, placing it in a unique position within the industry. Notably, the sector contributes significantly to the economy, generating substantial employment opportunities and fostering economic growth. The government’s dedication to fostering sustainable tourism practices and investing in infrastructure development further establishes a solid foundation for long- term investment prospects, offering a safe and conducive climate for international investment.

Tourism Australia is dedicated to bolstering and advancing the tourism sector by prioritising sustainable practices and the restoration of Australia’s remarkable natural beauty.

With a strong focus on environmental stewardship, Tourism Australia aims to foster the growth of both international and domestic tourism, showcasing the abundance of natural wonders that the country has to offer.

Australia’s position as a leader in renewable energy goes hand in hand with its commitment to sustainable tourism. As energy prices continue to rise, Australia has emerged as a frontrunner in renewable energy, poised to become a global superpower in this sector. The country boasts an abundance of solar and wind resources, making it an ideal location for harnessing clean energy. Moreover, Australia is blessed with significant deposits of critical minerals like lithium, which further enhance its potential for sustainable energy production.

The nation’s innovative capabilities extend across the entire renewable energy supply chain, encompassing research, development, manufacturing, and deployment. According to statistical websites, Australia currently holds the impressive title of being the world’s largest solar producer per capita. This achievement is a testament to the country’s strong commitment to embracing clean and sustainable energy solutions.

Australia’s focus on renewable energy not only contributes to mitigating climate change but also serves as a catalyst for scalable energy stability as the tourism sector experiences continued growth and expansion. With substantial investments in renewable energy infrastructure and a robust patent portfolio, Australia is well-positioned to ensure a reliable and sustainable energy supply that supports the increasing demands of the tourism industry while minimising its environmental footprint.

By leveraging its natural resources and investing in renewable energy technologies, Australia demonstrates its dedication to eco-tourism and the responsible stewardship of its pristine landscapes. This sustainable energy landscape further enhances Australia’s appeal as a destination that prioritises environmental preservation and aligns with the expectations of conscientious travellers seeking eco-friendly experiences.

In response to the thriving sustainable tourism market in Australia, Tourism Australia and Qantas, the country’s premier airline, have joined forces to launch the next phase of their ambitious Come and Say G’day campaign. With a strategic focus on ten key international markets, including the UK, US, Canada, Italy, Japan, South Korea, and New Zealand, this collaboration underscores their confidence in the remarkable growth potential of the Australian tourism sector. Investing a substantial $125 million into the campaign, Tourism Australia and Qantas are committed to maximising returns and further establishing Australia as a top global destination.

As the largest private investor in Australian tourism, Qantas takes great pride in promoting Australia on the global stage. Recognizing the pivotal role of tourism in the country’s economy, Qantas Domestic CEO Andrew David highlighted the significance of partnerships in driving the tourism industry forward. “As the national carrier, we know the importance of tourism in Australia and the value of partnerships to the tourism industry and the economy,” said David. This collaboration between Tourism Australia and Qantas exemplifies their shared commitment to leveraging the country’s natural beauty, diverse attractions, and unparalleled experiences to attract and welcome visitors from around the world, contributing to the continued growth and prosperity of the Australian tourism sector.

In May, Tourism Australia, alongside Tourism and Events Queensland and Destination Gold Coast, orchestrated a remarkable event that captured the attention of the global tourism industry—the Australian Tourism Exchange 2023 (ATE23). Set against the vibrant backdrop of the Gold Coast, this prestigious gathering united more than 2,300 delegates from Australia and 30 countries worldwide, facilitating a staggering 38,000 one-on-one business appointments. ATE23 proved instrumental in showcasing lucrative business prospects, further bolstered by Tourism Research Australia’s promising projections. According to the forecast, international visitor expenditure is set to exceed pre-pandemic levels by 2024, with visitor arrivals surpassing those levels by 2025. With a robust pipeline of 225 projects valued at a jaw-dropping $42.8 billion, the investment landscape in the Australian tourism sector brims with excitement and potential. This vast portfolio encompasses diverse sectors, with aviation boasting 13 projects worth $16.7billion, arts, recreation, and business services featuring 79 projects valued at $15.7 billion, and the accommodation sector leading the way with 133 projects worth $10.5 billion. The significance of ATE23 was underscored by Federal Tourism Minister Don Farrell, who emphasised its role in supporting the industry and the livelihoods of countless Australians and communities reliant on tourism. Queensland Premier Annastacia Palaszczuk expressed her enthusiasm for showcasing the unique attractions of Queensland, including the Great Barrier Reef and the rich Aboriginal and Torres Strait Islander cultures, to the global tourism trade market. The event’s host, the Gold Coast, renowned as one of Australia’s premier destinations, proved ideal for connecting international wholesale holiday buyers with industry leaders. ATE23’s impact extended beyond the event itself, as buyers and overseas travel media embarked on comprehensive tours of Queensland’s must-visit destinations. Aligned with the Towards Tourism 2032 roadmap and complemented by Queensland’s global marketing efforts and a substantial $200 million aviation investment in the region, ATE23 exemplified Queensland’s steadfast commitment to international tourism. Serving as a catalyst for attracting foreign investments, this landmark event signalled rapid financial growth and remarkable returns in the Australian tourism industry, making it a compelling prospect for discerning investors.

Australia stands proudly among the exclusive group of countries holding the highest AAA credit rating from all three major credit rating agencies: Moody’s, S&P, and Fitch. With a recent surge in commodity prices fueling its recovery from the Covid-19 pandemic, Australia has climbed to become the world’s 12th largest economy by nominal GDP3. The nation not only boasts a substantial economy but also claims the title of the wealthiest nation in terms of median wealth per adult, with an impressive figure of $273,9004.

Tourism Research Australia (TRA) has published their latest forecasts on domestic and international travel, providing valuable insights for the industry. According to TRA’s projections, total visitor expenditure is expected to reach an impressive $227.7 billion by 2027. Domestic travel is experiencing significant growth, with overnight and day trip expenditure surpassing previous levels. By 2027, domestic visitor nights are forecasted to reach 465.8 million, domestic overnight trips are projected to reach 126.2 million, and domestic day trips are expected to amount to 244.4 million. On the international front, visitor expenditure is anticipated to exceed pre-pandemic levels by 2024 and reach $48.8 billion by 2027. TRA’s insights provide valuable information for stakeholders and industry players to make informed decisions and capitalise on the opportunities within the tourism sector.

Australia’s stability, low-risk profile, and AAA credit rating from major credit agencies make it an appealing investment destination. The country’s robust banking system, transparent markets, and effective regulatory measures provide a secure environment for preserving and expanding wealth. Furthermore, Australia’s strong economic ties with rapidly growing Asian economies, coupled with its abundant natural resources, contribute to its economic prosperity and long term stability.

For foreign investors seeking a secure and lucrative investment avenue, the Australian tourism sector offers an attractive proposition. With its strong economic prospects, commitment to sustainability, and robust pipeline of projects, Australia presents an ideal investment landscape. By capitalizing on the country’s thriving tourism sector, investors can not only contribute to Australia’s economic growth but also reap substantial returns in this dynamic market.

To facilitate investment in Australia, the Australian Trade and Investment Commission (Austrade) provides comprehensive support and guidance. Austrade’s network of investment specialists around the world can assist investors in identifying potential projects, strategic partners, and navigating the investment approval process, ensuring a streamlined and efficient investment experience.

Australia’s stable economy, skilled workforce, leadership in renewable energy, commitment to open trade, and robust tourism sector make it an appealing destination for foreign investors. With ample opportunities for growth and a supportive investment environment, now is the time for investors to explore the exciting potential of the Australian tourism sector.