Political tension has contributed to an 80 percent drop in Chinese tourist visa applications to Australia in the past three months, as bilateral ties hit a low.
Chinese scholars and tourism insiders warned Monday that Australia will pay for its sour relations with Beijing, triggered by Canberra's decision to grant Rebiya Kadeer, the alleged organizer of the Urumqi riot, a visa in July, despite strong protests from Beijing.
Pang Zhongying, an expert on international relations at the Renmin University of China, said the disputes have affected Australia-bound tourism because well-educated, prosperous Chinese pay the closest attention to such events.
The Australian newspaper, based in Sydney, Monday reported the sharp drop, saying it has put in doubt a forecasted jump in tourist numbers from China, Australia's fastest-growing tourism market, of 6.4 percent this year.
Australian officials had expected China, which is Australia's fourth-largest market, could be its largest market by 2018, ahead of the UK, US and New Zealand. China already accounts for 10 percent of all visitor nights.
Australian media has speculated that the drop is not only due to concerns over the A/H1N1 influenza and the global recession but the recent disputes between the two countries, including the collapse of the Chinalco-Rio Tinto deal in June and Australia's intervention into the commercial spying case of Australian Rio employees in Shanghai, including its Australian executive Stern Hu.
And the main source of China's anger, as The Australian said Monday in a separate report, stemmed from Canberra's decision to grant Kadeer a visa, as well as the decision by the Melbourne film festival to screen a documentary on her.
China canceled the trip of a vice-foreign minister to Australia early this month for a regional meeting, widely viewed as a signal of its discontent.
"It is understood that China regards the decision to grant Kadeer a visa as inconsistent with previous decisions, such as Australia's repeated refusal to issue a visa to Holocaust denier David Irving," said the report.
Australian Assistant Treasurer Nick Sherry Monday denied any suggestion that tensions have an impact on tourism figures, saying it was consistent with drops in tourism experienced across the globe.
But according to The Australian, in June when fears of the A/H1N1 influenza were at a peak and Australia had become one of the countries hardest hit by the virus, the number of Chinese visitors was down by only 21 percent compared with the same period in 2008, in sharp contrast to the 80 percent decline in the past three months.
Some Chinese agencies dealing with Australia-bound tours have recently received calls from customers asking whether the soured relations would impact the quality of their trips.
"The tourism industry is very delicate, easily disturbed by all kinds of factors," Ma Jun, a business director of the Beijing Tour website, told China Daily.
Qu Tao, head of the Australia-bound tour department with Beijing Comfort Travel Service, said the tensions, if they continue, are likely to affect commercial touring groups from China with a high-spending capacity.
The Australian newspaper reported that in the first four months this year, just prior to the first confirmed case of H1N1 influenza in Sydney, Australia saw a 6 percent increase in Chinese tourists compared with the same period last year.
In May, as the virus hit Australia hard, up to 50 percent of bookings with Beijing and Shanghai agents were canceled.
The market in July and August was supposed to pick up, but it did not. Qu said primary and high school students are required to stay at home for a week if they take a trip. This stipulation has made many children and their parents, who are a strong force for the travel market in the summer, give up their travel plans.
For the Golden Week in October, a weeklong holiday that sees the most Chinese tourists travel overseas, only a few tourists have inquired or booked Australia-bound tours through Qu's company, she said.
Jack Levine in Sydney contributed to the story