China seen replacing US in 2016 as leading business travel market
Updated: 2013-08-08 06:38
By Michael Barris in New York (China Daily)
Aided by an increase in business-travel spending, the United States will keep its title as the world's leading corporate travel market until 2016 - then China will take over the top spot, according to a report from a travel trade group.
China is "moving toward global dominance of the business-travel market," the United States-based Global Business Travel Association said in its 2013 annual global outlook.
In 2012, the association said that China would surpass the US by 2015 as the world's largest business-travel market, but in its latest report issued on Tuesday it issued a revised forecast based on what it said was "steady" growth in US business-travel spending despite a "shaky" economic recovery. It projected a 4.2 percent rise in US business-travel spending this year to $273 billion, and that means a delay in China overtaking the US by at least a year, according to the association.
China logged $196 billion in business-travel spending last year, up 13.2 percent from 2011, and a fivefold increase from the $32 billion of 2000, according to the report. The US market saw $262 billion in spending in 2012, a 4.4 percent rise. The report estimates that China's "meteoric growth" will continue, doubling to $375 billion by 2017.
China's outpacing of the US in global business-travel spending would mark the latest installment of a changing of the guard that has so far included China eclipsing the US as the world's largest automotive market in 2009, and overtaking the US as the world's biggest art market in 2011, although it recently slipped back into the No 2 spot in the art world amid the slowing Chinese economy. China is also widely expected to displace the US as the world's largest economy by the end of this decade.
"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," the association said. "Rapidly growing markets like China, India and Brazil are in prime position to become major global players in business travel."
The Alexandria, Virginia-based association has 5,700 members with more than $340 billion of global business travel under management. The association's outlook predicts business-travel trends over the next year by analyzing total business-travel volume and spending, projections of changes in costs and other factors across 75 countries and 48 industries.
The new report forecasts global business-travel spending this year will increase 5.4 percent from last year to $1.12 trillion, reflecting the onset of a more stable spending environment following a year of economic and political uncertainty. As travel spending remains steady during the second half of the year, next year is expected to see 8.2 percent growth. It will be followed by increases of 7.6 percent in 2015, 7.2 percent in 2016 and 7.1 percent in 2017, according to the association.
The report also said that "the worst in Europe is over" and predicted that business-travel spending in Western Europe's markets will rebound in the next five years. Amid a recession that "severely hampered" European business travel, related spending in Europe last year came to $260 billion.
The report sees China business-travel spending increasing 15 percent this year, followed by 16.8 percent in 2014, 13.6 percent in 2015, 12.3 percent in 2016 and 11.5 percent in 2017. By comparison, the US is seen achieving growth of 4.5 percent this year, 5.9 percent in 2014, 4.2 percent in 2015, 3.2 percent in 2016 and 3.3 percent in 2017. The UK market is expected to increase 1.9 percent this year, 3.7 percent in 2014, 8.1 percent in 2015, 7.5 percent in 2016 and 7.9 percent in 2017.