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.