Tourism Industry Reforms

Introduction

Microeconomics as a field is immensely helpful for understanding the economic decisions taken by a particular firm. Further, it leads to efficient allocation of scare resources. Amongst the various sectors prominent in Australia, tourism is arguably one sector that deserves a special mention and attention.  It contributes about 2.7% to the GDP and also accounts for 4.6% of the total employed people in Australia.  Tourism, over the time has generated sufficient revenues but still there are difficult demand circumstances faced by this industry. In wake of these challenges, it is imperative that the industry undergoes reforms so as to enhance its overall adaptability. The aim of this paper is to present the various reforms that have been introduced in the Australian tourism sector.

Tourism industry – Government Initiatives

The Tourism Minister has advocated the National Long Term Tourism Strategy and highlighted the potential of tourism that can be achieved. The long term strategy for the sector is encapsulated in the Tourism 2020 program. As per this plan, the government will involves other stakeholders particularly tourism industry operators so as to ensure that the framed strategy is religiously implemented and progress monitored in a periodic manner. There are various reforms that the Federal government and the State government have initiated for the development of tourism sector (Reisinger and Turner 2015). These reforms have been initiated on the recommendation of the a dedicated Commission which concentrated on infrastructure related to tourism projects, expansion of tourism sites along with the assessments concerned with zoning, planning and development.

The selection of projects also is the core focus as it would effectively address the infrastructure related issues linked with tourism. Funding for the tourism infrastructure could be generated through increasing the user fee (Techera and Klein 2013). This is evident from the national parks related infrastructure funding where shortfall is quiet common since the users do not charge any money from the park agencies. In view of this, reforms are introduced by certain state government such as Tasmania and South Wales which have started charging fee for accessing national parks.  Further, access fee should also be charged for popular destinations so as to reduce the overall congestion. The specific infrastructure available within the national parks is also now being charged which is making up for the funding requirement. Also, the park agencies should monetize the visit by ensuring the commercial activities through regulated players are encouraged in a eco-friendly manner.

Further, the private players are also required for enhancing the overall efficiency of the tourism related infrastructure as this would lead to an improvement in the overall experience. However, in order to ensure that environment is not exploited, government regulation is a must for activities in private sector. Additionally the framework meant for tourism needs to be continuous updated and modified in line with the dynamic environment in which the industry thrives (Maginn and Foley 2014). The reforms must be introduced only after risk based assessment similar to the process followed for approval of mining projects. This ensures that only those projects are approved which adhere to the overall regulatory objectives. Since the system tends to be restrictive, hence it is imperative that the planning and zoning system should be flexible. This flexibility ensures that tourism can occur as per the requirement (Ruhanen Whitford and McLennan 2013). Further, this also ensures that the tourism industry responds adequately and promptly to changes in technology and underlying demand which are quite common. Further, as the demand proliferation takes place from different segments, there is a need for innovation with regards to services and hence reforms are necessary. However, it is imperative that these reforms must be introduced with the cooperation of the local government which must have intention and requisite personnel for requisite development.

Digital Technologies

The increasing penetration of digital technologies has fundamentally transformed the ecosystem in which the industry operates. As a result, the sale of online tickets and sale of related merchandise is on the rise. As a result, the tourism industry needs to exploit this aspect in order to ensure that more tourists visit Australia (Dobson and Hooper 2015). For this, it is imperative that the traditional players should realize potential of digital technologies and leverage the same to modify their business accordingly.

Infrastructure Investment and Returns

It is estimated that the government’s ambitious tourism strategy named Tourism 2020 is expected to almost double the spending of tourists (Wilson and Hemming 2013). However, in order to realize these gains, it is imperative that FDI must be attracted so that requisite investment is made in upgrading the existing infrastructure available at these sites. The reforms in government policy are essential so as to attract interests of global players in order to ensure that the potential of the tourism industry is enhanced.

Regulatory Reforms

For the achievement of the ambitious targets set under Tourism 2020, the Australian development accommodation is being processed. Further, there has been a revision of tourism strategy on par of Tourism Australia so as to ensure that the project takes on times and the various projects are implemented in a time bound manner  (Australia’s International Tourism Industry, 2015). Further, due to the booming teal estate market, the hotel development is complex in Australia and hence a host of risk are planned which would enhance the execution rate.

Regulations - Hotel Development

Considering the complex hotel development process, it is required that that the various stakeholders need to be on board. It is imperative that effective planning and approvals are received so as to facilitate hotel and related infrastructure development. As per the Austrade Commission, the regulations related to hotel development provide assistance for opportunity identification along with applying for environment and planning for obtaining requisite approvals. The report also highlights the regulatory requirements that are requisite for four star hotel developments and also provides comparative analysis of prevailing environmental regulations in different regions and states. For improving the planning and head development, recommendatios have been offered by Australian Hotel Development Regulation (Dobson and Hooper, 2015).

Conclusion

Based on the above discussion, it may be concluded that the tourism infrastructure in Australia needs improvement which can result in bright future for this critical industry.  Due to dynamic nature of the industry and constant concerns, the case for reforms is growing stronger and the government has also initiated certain reforms. This is specifically due to the advent of digital technologies which has fundamentally altered the nature of industry. However, as the consumer demand alters, it is imperative that innovative services must be provided to the customers The presence of government is also imperative so as to encourage eco-friendly tourism while maximizing revenue at the same time. Also, through appropriate zoning and planning guidelines, the overall structure and revenue generated from the tourism industry may improve.

References

Australia’s International Tourism Industry (AITI) (2015), Productivity Commission Research Paper, Retrieved on 31^st July, 2016 http://www.pc.gov.au/research/completed/international-tourism/international-tourism.pdf

Dobson, C. and Hooper, K. (2015), Insights from the Australian Tourism Industry, Retrieved on 31^st July, 2016 http://www.rba.gov.au/publications/bulletin/2015/mar/pdf/bu-0315-3.pdf

Wilson, C. and Hemming, S., (2013), Conflicts, battlefields, indigenous peoples and tourism: addressing dissonant heritage in warfare tourism in Australia and North America in the twenty-first century, International Journal of Culture, Tourism and Hospitality Research, 7(3), 257-271.

Maginn, P. and Foley, N. (2014) From a centralised to a ‘diffused centralised’planning system: planning reforms in Western Australia, Australian Planner, 51(2),151-162.

Reisinger, Y. and Turner, L., (2015). Cultural Marketing for Asian Tourism into Australia. In Proceedings of the 1998 Multicultural Marketing Conference (pp. 535-535). Springer International Publishing.

Ruhanen, L., Whitford, M. and McLennan, C. (2013), Indigenous tourism in Australia: an analysis of international demand and supply. In The Proceedings of 1st World Conference on Hospitality, Tourism and Event Research and International Convention and Expo Summit 2013, Bangkok, Thailand, 25th-28th May 2013 (pp. 377-382). International Program in Hotel and Tourism Management, Siam University.

Techera, E.J. and Klein, N. (2013). The role of law in shark-based eco-tourism: lessons from Australia. Marine Policy, 39(1), 21-28.

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