A growing Indian market and an influx of backpackers is helping to fill the gap created by the absence of Chinese tour buses along the Great Ocean Road.
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The south-west remains off China's books for group overseas travel after Australia was cut from the list of approved destinations following the removal of COVID border closures in January.
While Great Ocean Road Regional Tourism general manager Liz Price said the authority remained "concerned" with the tourism shortfall, she said an increase in other markets was encouraging.
"We're starting to see the cost of living is starting to take a toll on people with travel being a discretionary spend, we're also going into our slower season so there's quite a few challenges facing the sector at the moment," she said.
"International levels haven't returned to pre-covid numbers and we didn't expect them to until late 2024 to 2025. China was slower to return because they were locked down much longer than other countries were.
"But we have seen good numbers come out of India, they came last year for the T20 and it's continued from there, they're a very strong market for us.
"They've traditionally been one of the fastest growing markets alongside China, but everybody talks so much about it because the spend out of China pre-covid was the equivalent of the next four countries combined."
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Warrnambool City Council manager of tourism Paul Thompson said while perhaps slow, visitor numbers were growing.
"The international market continues to recover, with international visitors returning to our region, as more international flights into Melbourne are being scheduled," he said.
"The return of international students will allow their visiting friends and relatives to experience the great natural and cultural attractions of Warrnambool throughout the year, and we have already been seeing more of these travellers return, particularly from India.
"More travelling backpackers are also enjoying the attributes of our region.
"Although, the larger international coach groups have not fully recovered. These groups are of great value to the likes of Flagstaff Hill, and larger accommodation venues. However it is the 'flexible independent reveller' who travels in smaller groups and tends to spend more locally thus providing higher yields for the regions' businesses."
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