Global business travel spending is expected to
rise throughout 2013 and continue its ascent over the next several years.
According to the latest installment of the GBTA BTI™ Outlook – Annual Global Report & Forecast, sponsored by Visa, Inc., global spending on business travel is forecast to reach $1.12 trillion in2013,
a 5.4% increase from 2012, with travel spend stabilizing
after a year rocked by worldwide economic and political uncertainty.
Steady business travel spending in the second half of 2013 is expected to lay the foundation for 8.2% growth in 2014, followed by 7.6%, 7.2% and 7.1% growth in 2015, 2016 and 2017 respectively.
The report, which details travel spending in 75 countries, along with the top industries, economic factors and characteristics that influence business travel, finds that developing markets around the world – particularly countries in the Asia Pacific andLatin America regions – will
permanently reshape the business travel landscape.
“Travel is indispensable to trade, commerce and business expansion in a global economy,” said Michael W. McCormick, GBTA executive director and COO. “This report shows that new opportunities are opening up in markets around the world for companies willing to invest in business travel to drive growth. It also serves as yet another wake-up call for the U.S. and Europe to improve aging infrastructure, establish fiscal order and stay competitive, because emerging economies are increasingly focused on meeting their own fast-growing business travel needs.”
A Rapidly Changing Global Order
In the wake of a lopsided economic recovery – with stalled growth in the developed world but economic expansion approaching or exceeding double digits in many emerging economies – the business travel landscape is set to change significantly over the next five years. Rapidly growing markets likeChina ,
India and Brazil are in
prime position to become major global players in business travel.
“This year’s global BTI™ shows the importance that emerging markets like China, Brazil and India play in the global business travel marketplace,” said Tad Fordyce, head of global commercial solutions at Visa Inc. “With global business travel expected to experience continued growth in the next few years, China is projected to overcome the U.S. as the top business travel market in the world by 2016."
Business travel spending in the Asia Pacific region has grown 8% annually since 2000, more than doubling in size and totaling $393 billion in 2012. China is moving towards global dominance of the business travel market, and GBTA now expects that it will surpass the U.S. as the largest business travel market in the world by 2016 (although this is two years later than we projected in last year’s Outlook, largely due to a stronger-than-expected business travel revival in the U.S.) Spending inChina has grown
from $32 billion at the start of the millennium to $196 billion in 2012, and China ’s
meteoric growth is expected to continue, doubling to $375 billion by 2017.
India is quickly becoming a major global business travel
market. In 2012, India
surpassed Canada
to become the 10th largest business travel market in the world, spending a
total of $22.1 billion on business travel. Over the next five years, GBTA
expects India ’s
business travel spend will grow at a compound rate of 13.5%, making it one of
the fastest growing markets in the world.
According to the latest installment of the GBTA BTI™ Outlook – Annual Global Report & Forecast, sponsored by Visa, Inc., global spending on business travel is forecast to reach $1.12 trillion in
Steady business travel spending in the second half of 2013 is expected to lay the foundation for 8.2% growth in 2014, followed by 7.6%, 7.2% and 7.1% growth in 2015, 2016 and 2017 respectively.
The report, which details travel spending in 75 countries, along with the top industries, economic factors and characteristics that influence business travel, finds that developing markets around the world – particularly countries in the Asia Pacific and
“Travel is indispensable to trade, commerce and business expansion in a global economy,” said Michael W. McCormick, GBTA executive director and COO. “This report shows that new opportunities are opening up in markets around the world for companies willing to invest in business travel to drive growth. It also serves as yet another wake-up call for the U.S. and Europe to improve aging infrastructure, establish fiscal order and stay competitive, because emerging economies are increasingly focused on meeting their own fast-growing business travel needs.”
A Rapidly Changing Global Order
In the wake of a lopsided economic recovery – with stalled growth in the developed world but economic expansion approaching or exceeding double digits in many emerging economies – the business travel landscape is set to change significantly over the next five years. Rapidly growing markets like
“This year’s global BTI™ shows the importance that emerging markets like China, Brazil and India play in the global business travel marketplace,” said Tad Fordyce, head of global commercial solutions at Visa Inc. “With global business travel expected to experience continued growth in the next few years, China is projected to overcome the U.S. as the top business travel market in the world by 2016."
Business travel spending in the Asia Pacific region has grown 8% annually since 2000, more than doubling in size and totaling $393 billion in 2012. China is moving towards global dominance of the business travel market, and GBTA now expects that it will surpass the U.S. as the largest business travel market in the world by 2016 (although this is two years later than we projected in last year’s Outlook, largely due to a stronger-than-expected business travel revival in the U.S.) Spending in
Latin American business travel totaled $49 billion in 2012. Brazil is by far the largest business travel
market in Latin America , with total business travel
spending of $30 billion in 2012. Brazil has the potential to become a major
business travel market over the next decade, but will need to re-establish more
robust economic growth to do so. Total spending on Brazilian business
travel is expected to grow 7.3%, on average, over the next five years, becoming
the 6th largest business travel market in 2014, advancing past Italy and France .
It is expected to reach $45 billion in 2017.
GBTA expectsMexico to experience the highest growth in
business travel spending in North America over the next five years as economic
reforms are put into place that should grow its economy faster than those of
its neighbors to the north. Total spending in Mexico was $6.8 billion in 2012, and spending
is projected to grow another 9.8% in 2013, reaching $7 billion.
Business Travel Growing Faster in BRICs vs. Developed Economies
There are clear signs of rising business travel spending across developed markets as well. Total spending on business travel in theU.S. reached $262 billion in 2012, and
growth remains steady, despite a shaky economic recovery. In 2013, total
business travel spending is expected to reach $273 billion.
Business travelers inWestern Europe generated $260 billion in total
business travel spending in 2012.
While European business travel has been severely hampered over the last couple of years, GBTA expects that the worst inEurope is
over. The next five years should see a bounce back in business travel
among all of Western Europe ’s major markets.
However, while it is clear that business travel spending is expected to grow across the globe, the chart below shows that BRIC nations can generally expect to see much stronger growth in business travel spending compared with more established markets like theU.S. and Western Europe . (The one exception
among the BRIC nations is Brazil ,
where robust growth in 2013 and 2014 is expected to slow in the following
years.)
GBTA expects
Business Travel Growing Faster in BRICs vs. Developed Economies
There are clear signs of rising business travel spending across developed markets as well. Total spending on business travel in the
Business travelers in
While European business travel has been severely hampered over the last couple of years, GBTA expects that the worst in
However, while it is clear that business travel spending is expected to grow across the globe, the chart below shows that BRIC nations can generally expect to see much stronger growth in business travel spending compared with more established markets like the
BRIC
COUNTRY GROWTH
|
|
|
|||
Country
|
2013
|
2014
|
2015
|
2016
|
2017
|
|
15.0%
|
16.8%
|
13.6%
|
12.3%
|
11.5%
|
|
14.2%
|
15.9%
|
3.4%
|
4.2%
|
6.0%
|
|
10.4%
|
13.0%
|
13.8%
|
14.0%
|
13.2%
|
|
8.5%
|
8.2%
|
7.2%
|
7.9%
|
7.2%
|
DEVELOPED
MARKET GROWTH
|
|
||||
|
4.5%
|
5.9%
|
4.2%
|
3.2%
|
3.3%
|
|
2.2%
|
2.6%
|
3.3%
|
2.5%
|
2.4%
|
|
1.9%
|
3.7%
|
8.1%
|
7.5%
|
7.9%
|
|
5.1%
|
5.0%
|
6.6%
|
5.6%
|
5.6%
|
Top 15 Business Travel Markets
The GBTA report also identified the top 15 business travel markets, ranked by spending in 2012.
TOP 15 BUSINESS TRAVEL
MARKETS
|
||
Country
|
2012 Total Spending
|
Percentage Growth vs.
2011
|
|
$262 billion
|
4.4%
|
|
$196 billion
|
13.2%
|
|
$65.2 billion
|
-1.2%
|
|
$50.5 billion
|
1.1%
|
|
$40.2 billion
|
0.1%
|
|
$35.7 billion
|
-2.1%
|
|
$32.7 billion
|
-7.5%
|
|
$30.5 billion
|
2.8%
|
|
$30.1 billion
|
9.3%
|
|
$22.1 billion
|
5.8%
|
|
$22.0 billion
|
1.4%
|
|
$21.1 billion
|
2.8%
|
|
$20.4 billion
|
2.6%
|
|
$17.9 billion
|
-8.0%
|
|
$17.8 billion
|
-4.5%
|