Asian turmoil hits Australian tourism

Asian turmoil hits Australian tourism

By Jack Taylor

SYDNEY (AFP): Australian flag-carrier Qantas yesterday became
the third airline to suspend flights from here to South Korea as
Australia's tourism industry braces for the impact of a deepening
Asian economic crisis.

Qantas Airways Ltd. announced the decision to suspend its four
weekly flights to Seoul from Feb. 1 because of a sharp drop in
demand for seats amid deteriorating economic conditions in South
Korea.

Qantas also suspended plans to codeshare with South Korea's
privately-owned Asiana Airlines on four flights each week between
Seoul and Sydney.

Earlier this week, Asiana announced it was halting its two
flights a week into the northern Australian resort of Cairns
while Air New Zealand suspended four flights a week from Auckland
and Brisbane to Seoul from Dec. 31.

The airlines' decision confirms the worst fears of Australian
tourism authorities, which have been forced to drastically revise
their projections of growth in Asian tourist arrivals which had
been buoyant until recently.

Before the crisis Asian countries which accounted for half of
Australia's 4.1 million tourists had been tipped to grow at a
faster rate than any other markets.

After enjoying 17 percent growth in Asian arrivals in 1996,
they had been looking forward to continuing with similar double-
digit growth into the foreseeable future.

But after slashing 1997 growth forecasts for the Asian market
from 16 percent to about six percent in October, the Australian
Tourist Commission (ATC) admitted this week it is now
anticipating a protracted slump with around six or seven percent
growth expected for up to five years.

Tourism from South Korea, which had been one of the fastest
growing markets, was expected to be worst affected along with
Thailand and Indonesia.

ATC deputy managing director Bill Calderwood said that while
the forecasts might alarm the local tourism industry, the decline
could lead to new business from elsewhere.

"It is true to say that we are disappointed the double-digit
growth can't be sustained, but it gives opportunities to develop
a wider spread of business," he said.

Qantas executive general manager commercial Geoff Dixon said
Friday that in the past month, the airline had experienced a 65
percent drop in demand for seats on the South Korea route,
compared with the same period last year.

"We are receiving widespread cancellations from tour groups
and individuals," he said in a statement.

"Other airlines have also encountered a severe decrease in
passenger numbers and have adjusted their schedules."

Qantas did not expect travel between Korea and Australia to
pick up in the short to medium term, he said, adding: "We will,
however, monitor the situation and review our decision when
economic conditions have improved sufficiently."

The airline will maintain sales staff in Seoul and Pusan and
continue to sell Australia on Qantas' codeshare services with
Asiana.