Recently, Tom Kennedy, Chief Investment Strategist at JPMorgan Chase, stated in a report that China’s shift to reopening has brought potential implications for Australia’s economy: Given that China is the largest consumer of Australia’s tourism and education exports, the biggest potential upside from the reopening itself lies in the services sector. Kennedy noted that a full recovery of Australia’s tourism industry will add 0.5% to the country’s GDP, while the return of Chinese international students will add another 0.4% to its GDP — together equivalent to nearly one percentage point of Australia’s economic growth. Although Australia lifted COVID-related travel restrictions in July last year, the number of short-term overseas visitors to the country remains far below pre-pandemic levels. The latest data from the Australian Bureau of Statistics shows that in October 2022, Australia received 430,000 visitor person-times, a 44% drop from the level in October 2019, when Australia received more than 1 million visitor person-times. Kennedy said that in 2019, Chinese tourists accounted for 15.3% of Australia’s total inbound tourists, making it Australia’s largest source of inbound tourists. He added that the average spending of Chinese tourists is four times that of tourists from New Zealand, which is Australia’s second-largest source of inbound tourists. Kennedy wrote in the report that tourism-related consumption momentum is expected to gain rapid traction in 2023 and 2024: Although spending figures adjusted for duration do not change notably, real GDP is an aggregate concept, so the absence of Chinese tourists has always been a clear headwind for Australia. In addition, he noted that Australia’s intake of international students from China is expected to accelerate this year. According to data from the Australian Department of Education, from January to October 2019, there were more than 253,000 international students from China in Australia; by October 2022, this figure had dropped to approximately 173,000. The latest data shows that international students from China account for 26% of Australia’s total student enrollment, making China Australia’s largest single source of international students. Kennedy also wrote: If education exports to China return to the 2019 level, it will boost Australia’s real GDP by 0.4%. In an environment where household consumption is slowing, this is a clear boost, but it is not a panacea to prevent growth from decelerating. © 2021 Meishun (Hong Kong) Management Consulting Co., Ltd. and Meishun (Hangzhou) Management Consulting Co., Ltd. All rights reserved. Meishun Meiyin (Hangzhou) Consulting & Management Co., Ltd. is the domestic subsidiary of Hong Kong Meishun Management Consulting Co., Ltd. under the same actual controller. Both companies are under the same ultimate beneficial owner, managed as a single entity in China, and comply with the laws of Hong Kong and mainland China.