The Index presents many other encouraging trends including strong increases in Australia’s tourism and migration engagement with Asia, as well as increases in overall engagement with Indonesia and India. Australia’s overall engagement with ASEAN and Japan has remained relatively stable and high.

The 2013 Index is framed within a new political and policy environment. The recent Federal election has led to a special focus on economic engagement in our region, with Prime Minister Tony Abbott presenting ambitious deadlines to conclude Free Trade Agreements (FTAs) with some of our key Asian trading partners. This year’s Index features ‘Viewpoints’ from some of Australia’s leading business people, academics and government officials on our FTA negotiations in Asia, including with China, Japan, South Korea, Indonesia and India.

The Index’s findings demonstrate that Australia still has a long way to go to realise the potential of our Asian relationships. We are proud to bring together the strengths of PwC, the Melbourne Institute and Asialink to provide this important tool, which we hope continues to be a valuable instrument for policy makers, businesses, the academic community and commentators to understand and strengthen our interactions with Asia.

Note: We are pleased to provide greater functionality and easier access to the Index’s dedicated website – – in order to better meet the needs of our readers.


The tourism component of Australia’s engagement with Asia grew by 9.9 per cent in 2012 to about 4.9 million traveller movements. This outcome reflected strong growth of 12.1 per cent in the inflow of tourists to Australia, and growth of 8.6 per cent in the number of Australians travelling to Asia. Outgoing movements made up 63.4 per cent of total traveller movements in 2012, with the strength of the Australian dollar encouraging Australians to holiday abroad.

In contrast, tourism engagement with the ROW fell marginally by 0.7 per cent in 2012. While there was solid growth of 4.4 per cent in the number of Australians travelling to the ROW group of countries in 2012, there was a 7.8 per cent decline in the inflow of visitors from the ROW. The number of Australians holidaying abroad in 2012 exceeded the inflow of tourists from the ROW for the sixth year in a row; prior to 2007 incoming tourists consistently outnumbered outgoing tourists. The sustained slowdown in economic growth post-GFC in many countries coupled with the strength of the A$ were likely deterrents to potential ROW visitors.

The trends outlined above, in particular growing inbound tourism from Asia and declining inbound tourism from the ROW, have led to an increase in the relative importance of Asia for Australia’s tourism industry. For example, in 2012 inbound tourist travel from the ROW (around 2.27 million people) was 27 per cent higher than that from Asia (around 1.79 million people). Just two years’ earlier, in 2010, the gap was significantly wider: inbound tourist travel from the ROW (around 2.45 million people) was 55 per cent higher than that from Asia (around 1.6 million people). The major source countries for tourists visiting Australia in 2012 were New Zealand (around 20 per cent of the total); the United Kingdom (10 per cent); China (9.8 per cent); the United States (7.8 per cent); and Japan (5.8 per cent of total incoming tourists).

Tourism engagement with both Asia25 and the ROW is dominated by people travelling for short- term holidays. The number of short-term holiday trips in 2012 was almost three times the combined number of two-way visits to family and long-term holidays.