The number of travellers booking visits to Australia has fallen 10-20 percent since the fires began in September and the slump will cost the economy an estimated AUS$4.5 billion ($3 billion) this year, the Australian Tourism Export Council (ATEC) said.
"International visitors are cancelling because of fears around air quality, safety and the impact fires have had on our tourism offering as well as a lack of certainty on how long it will take for us to recover," ATEC Managing Director Peter Shelley said.
Global media have given extensive coverage to the wildfires, which have killed at least 28 people, burned an area larger than Portugal and blanketed the key tourist cities of Sydney and Melbourne in toxic smoke.
ATEC said the disaster had hit travel from the US, UK and Europe the hardest, coinciding with the December-February period which traditionally sees 50 percent of the annual tourist bookings from those markets.
Shelley said the industry and government need to urgently get the message out that many key tourism destinations are largely unaffected by the fires.
"There is no doubt our industry will take a hit," he said. "The sooner we can communicate a strong, positive message, the better."
Australia's conservative government, which has come under intense criticism for its response to the fires and to the global warming which scientists say has been a major contributing factor to the crisis, has announced an AUS$2 billion "bushfire recovery plan".
Prime Minister Scott Morrison said Friday that this would include a significant boost for the tourism industry, with details to be unveiled next week.
Tourism Australia was forced to suspend an upbeat advertising campaign launched in the middle of the crisis featuring pop star Kylie Minogue after the ad was met with incredulity about what many saw as poor timing.
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