Soaring Asian tourist numbers are expected to bolster Australian tourism revenue, forecast to reach almost $130 billion within five years.
The travel sector is booming thanks to the Australian dollar's recent tailspin, and is currently worth an estimated $118 billion in revenue, an IBISWorld report shows.
That figure is set to balloon to $129.7 billion by 2020/21 as more visitors from neighbouring Asian nations travel Down Under.
Travellers to Australia are at record highs, and for the first time, tourists from greater China - including Hong Kong - overtook New Zealand in September, figures from the Australian Bureau of Statistics show.
While more traditional markets like the UK, US and New Zealand are still important to our tourism industry, they're being upstaged by developing Asian countries, IBISWorld senior industry analyst Spencer Little said.
Chinese travellers outspent visitors from the United Kingdom by 50 per cent in the last financial year, he said.
"(And) China has surpassed the previously lucrative Japanese market in visitor numbers, nights stayed and dollars spent," he said.
"India is expected to follow suit, driven by a growing middle class and also an increase in the number of Indians choosing to study in Australia."
Tourism Research Australia predicts India to become the fifth most valuable market by 2020, aided by continued falls in the Aussie dollar.
The strength of inbound tourism from Asia is tipped to offset long-term weakness on the domestic front, where only modest growth in overnight travel is expected.
"The domestic tourism market is expected to remain in limbo as it loses customers as a result of shifting travel preferences," the IBIS report said.
And while the tourism industry's revenues are on the rise, profits are under pressure for many businesses.
IBISWorld expects only modest profit growth in the next five years, mainly because of intense competition in the sector.
"The number of traditional bricks-and-mortar businesses, such as travel agents, are expected to decline as finding travel information, booking and paying online becomes the norm for many travellers," the report said.
AUSTRALIA'S TOP TOURISM MARKETS in 2014/15
1. China ($7b in total trip expenditure)
2. UK ($3.5b)
3. US ($3.03b)
4. New Zealand ($2.49b)
5. Japan ($1.34b)
Source: Tourism Australia
