Qantas CEO Alan Joyce

A tie-up between Australian carrier Qantas and China Eastern will create one of the world’s largest airline partnerships following the June signing of the China-Australia Free Trade Agreement (ChAFTA) – and open the door more widely to tourist traffic.

Speaking on Talk to China, the interview series from the China government news agency Xinhua, Qantas Chief Executive Alan Joyce said of the deal: “We can benefit out of tourism, and out of economic activity.”

The partnership with China Eastern – given a green light last month by the Australian Competition & Consumer Commission – boosts each airline’s access to the other’s markets [for an initial five-year period], strengthening travel links that have already been enhanced in recent years. The approval is also subject to strict capacity conditions and reporting on seats and passengers flown between Australia and Shanghai.

Australian airport retailers are currently benefiting from the higher number of Chinese travellers at the country’s major gateways. In the year to July, Chinese nationals were Sydney Airport’s fastest growing market, up +17%.

Joyce told Xinhua that both airlines will increase capacity on the Australia-Shanghai route starting with Brisbane and plan to grow the market by over +20%.

CHINESE TRAFFIC BOOM

Chinese tourists have overtaken the British to become the second biggest tourism market in Australia with 864,000 arrivals behind New Zealand’s 1.15m, but they are closing in on the number one spot due to high annual growth rates.

The Australian government says that tourism “will be a big winner” from ChAFTA. “We forecast about 40% of inbound expenditure growth in the tourism sector to 2022-23 to be sourced from China. Some 1.5m Chinese are expected to visit Australia by that year and they are projected to spend more than A$10.2bn/$7.5bn.”