HOW IS AUSTRALIA’S CURRENCY AFFECTING TOURISM?
Australia has long been hailed as a top tourist destination. Their tourism industry has been thriving since the Australian Tourist Commission was developed over 50 years ago. The organization is now referred to as Tourism Australia, but the objective is the same – to entice international visitors to Australia, both for business and leisure, and to encourage its citizens to vacation domestically instead of abroad. Domestic tourism is a significant part of the overall tourism industry, calculated at over 73% of the country’s GDP. Despite the long journey for most people, there are a number of reasons to put Australia on your bucket list, and since Australia is roughly the same size as the united states, there’s always plenty to see and do. The great barrier reef is one of the many natural wonders of this country and houses the world’s largest coral reef. Sydney’s opera house, zoo, and harbor are all worth experiencing as well. There are also many beaches to choose from.
In general, there are other reasons people enjoy traveling, aside from tourist attractions. People who have traveled will tell you there’s nothing like the experience of being totally immersed in a completely foreign culture, including the experience of handling unfamiliar currency. Exchanging money is no doubt one of the fun adventures of traveling. The exchange rate of a country is something that changes constantly because currencies are constantly floating freely against each other. The value of a currency at any given time is determined by the amount that flows in and out of a country. When the volume is high, the currency is in high demand and the value of that currency increases against others. While it may not be the only motivator, a country’s high exchange rate does add an appealing element to its prospective visitors.
One of the factors that can drive the value of a currency up or down is the level of tourism in a country. This is a cyclical situation since tourism is affected by currency rates and the rates are in turn affected by the level of tourism. To date, the Australian dollar has fallen to a 2.5 year low against the American dollar which means the current rate is 1 AUD to 0.72 USD. For every US dollar a person trades in, they’ll receive 1.39 Australian dollars in return. This is lower than in previous years. People naturally like getting the most bang for their buck when trading currency in a foreign country, so a lower exchange rate will make a country less appealing to travelers, whether they are international or domestic, because domestic vacationers will choose less pricey destinations abroad. According to the editors of Smarter Travel, Australia was not even on the list of the top 10 best value destinations of 2018, and many experts agree it has a lot to do with its declining currency rate.