The reopening of Australia’s international borders has been flagged as an important step in the nation’s recovery and of crucial importance to mid-sized firms.
More than 1.23 million student, visitor and working holiday maker visa holders around the world are now eligible to travel to Australia if they are fully vaccinated, while a total of 56 international flights were due to arrive in the country on Monday, including 27 into Sydney.
Speaking at Melbourne Airport on Sunday, Prime Minister Scott Morrison said “the wait is over” for Australia’s international tourism industry, which contributed $60.4 billion to the economy in 2018-19 and supported 660,000 jobs.
“Tourists are coming back. That means those jobs become more certain going forward. Those earnings start to roll back into the country again and we start building up again as we push through this pandemic and we come out confidently on the other side,” he said.
“They can come and we can start building, once again, our very important tourism economy here right across the country.”
HSBC’s head of commercial banking for Australia, Steve Hughes, said that Australian companies, particularly mid-sized firms, have reached the limits of their domestic growth and have renewed confidence to consider offshore expansion.
“The reopening reinforces Australia’s credentials as an open economy and will allow companies with international interests to more easily conduct business,” he said.
“Local companies have already told us they plan to increase international trade in the wake of the pandemic to diversify supply chains.”
An HSBC survey of 7,300 global executives late last year found that markets in North America (43 per cent) and South Asia (38 per cent) are among the top potential new trade partners for Australian business.
While welcoming the arrival of international visitors, Australian Tourism Export Council (ATEC) MD Peter Shelley admitted that local tourism businesses remained concerned about the future.
“This is an important day for our industry and the first, but most important step in getting Australian tourism back on its feet,” he said.
“While the industry has endured a huge hit, the next 12 months will be the hardest for tourism owners as they work to rebuild once profitable businesses, having shed staff and depleted working capital and in many cases taken out loans to survive the last 2 years.”
A survey conducted by ATEC found that tourism supplier businesses were operating at 50 per cent or less capacity than 2019 on average while inbound tour operators were operating at 30 per cent or less capacity.
Businesses also indicated that they did not expect to see a significant flow of international visitors before October this year.
“Our financially fragile tourism export sector is now starting to cautiously emerge from the greatest challenge ever faced, having lost hundreds of quality business and thousands of valuable staff,” said Mr Shelley.
“Now more than ever we need united government leadership to remove obstacles impeding the recovery of our $45 billion tourism export sector.”
Jon Bragg
Jon Bragg is a journalist for Momentum Media's Investor Daily, nestegg and ifa. He enjoys writing about a wide variety of financial topics and issues and exploring the many implications they have on all aspects of life.
