International Tourism Marketing support under threat!

With the challenge to rural tourism because of Covid-19, what we need is help to keep the relationships with International Markets strong – not more problems from the Australian Government.

In late 2019, the Australian Government undertook a review of the Export Marketing Development Grant (EMDG). Stakeholders involved in the EMDG program were excited that a review was being actioned, as the EMDG program had some challenges that could do with a review. Stakeholders advocated for its continuation and suggested improvements via increased funding, amendments to the auditing process and refining the expense categories.

It is a program that has help thousands of exporters, my business included, enabled us to grow and consolidate our business internationally, but further enabled us to expand our business, employ more local people and bring more visitors into our region to spend in other businesses. That’s how tourism works, especially in regions. Activities, accommodation and services all working in a symbiotic relationship. Not working independently, but together to build experiences in locations that can be promoted to visitors all over the world.

The review was submitted to the Federal Trade Minister, with the expectation to reduce red tape, pre Covid-19 lockdowns in March 2020 . Unfortunately, after reviewing the submissions and recommendations to change the EMDG program, it was found that the proposals are potentially damaging to many tourism exporters. The Department recommended 10 changes, all were seeming approved without consultation to stakeholders and once approved by parliament, the changes will start from July 1, 2021, just when tourism is trying to re-engage with their International markets.

The major changes that have been recommended.

  • Maximum eligible funding across the program life will reduce from $1.2m to $770k per business.
  • The number of financial years to claim will reduce from 9 (with the first application allowing 2 years combined) to a proposed 8 years.
  • The program moves from a reimbursement program to a pre-approval program. Whereby businesses apply for funding they anticipate spending in the coming period (2-3 years depending on the marketing cycle you fall into).
  • Applicants will be required to demonstrate intended entry to ‘new markets’.
  • No provisions have been allocated to assist businesses impacted by the unique difficulties of COVID-19.
  • Marketing plans will need to be devised with evidence of being export ready.

So rather than an opportunity to help export markets, especially regional tourism to create or maintain those important relationships, it has become a cost cutting exercise, with the changes assisting larger formal businesses, that have set marketing plans for the next 18 months, that need approval by some bureaucrat in Canberra.

Tourism is not like that. Programs by Australian Tourism Export Council (ATEC) and State Tourism Offices (STO) and Tourism Australia (TA) are not formalised 18 months out, as it depends on so many factors, including the availability of International Agents and in-country promotions being finalised.

Only funding pre approved 2-3 year marketing plans, does not take into account the fast pace of change in tourism, of product supply and consumer demand. The International Market, especially into Asia has as its foundation relationships, personal relationships and there seems to be little understanding of the importance to maintain these, especially as we move to a post Covid-19 normality.

Regional Australia is adversely affected, with greater difficulty to promote regional Australia than higher profile city locations, to gain a wider distribution of visitors. Important not just for those regional locations, but also to allow greater inbound visitation, as the hubs are not full at critical times like Christmas, Easter and International travel high periods.

And now with challenges of Covid-19 into Regional Australia – we need help, not cutting back opportunities to engage and maintain those important international relationships for the future. Not just to encourage visitation into regions, but to ensure tourism is a dynamic local industry, to employ local people for the future of regional Australia.

If you would like more information please contact me at tony@park.com.au   , email Austrade at emdgreform@austrade.gov.au or the relevant minister at Trade Minister Simon Birmingham at minister.trade@dfat.gov.au

Regards

Tony Park

 

Author, Entrepreneur, Academic.

Current PHD Candidate, researching network bonds between Australian Tourism products and Chinese Travel Agents.

Developing Port Arthur Villas, Tasmania.  More at www.park.com.au