Chinese business travel will see big growth this year and next year, according to a new report from the Global Business Travel Association (GBTA). The group’s “BTI Outlook,” a semi-annual analysis of the Chinese travel market, found that travel spend was expected to grow by 12.5 percent, to $195 billion in 2012 and another 14.7 percent in 2013.
The report predicts that domestic business travel willrecover sooner and more strongly than international outbound travel. It also predicts that domestic travel spend will grow by 12.8 percent this year, and by 14.6 percent next year, reaching a total of $213 billion.
While the report did not examine incentive travel specifically, GBTA’s vice president of research Joseph Bates says that, “Over the past decade, the rise in business travel spending has come from significant increases in transient travel as well as meetings, incentives, conferences, and exhibitions business trips and rising real spend-per-trip.”
Looking more broadly at the state of China’s economy, the “BTI Outlook” finds that China’s economic growth, like that of Europe’s, has slowed at a similar pace. GBTA forecasts that China’s GDP will grow by only 7.8 percent in 2012, down from 9.2 percent GDP growth in 2011. With that said, Bates sees reason for international meeting and incentive planners to keep an eye on this destination.
“China continues to be a vibrant economy,” Bates says. “Increasing manufacturing output, trade growth, job gains, business formations, and infrastructure investments are all helping to propel Chinese economic growth and therefore business travel.”
Chinese business travel spending is second only to the United States, and there remains room for even more growth depending on how China deals with its significant supply-side constraints to business travel.
The country’s continued business travel growth also depends largely on the economic climate in the Euro-zone and U.S. in the coming months, according to Bates.
“The ripple effects of fiscal woes in these key markets can already been felt,” says Bates. “For example, international outbound travel from China is forecast to reach 5.5 percent growth in 2012 — a stark contrast when compared to double digit growth of 12 percent in 2011.”