A NEW report by the Global Business Travel Association (GBTA) has forecasted that global business travel spending will be US$1.3 trillion in 2016, and grow 5.8 per cent on average in the next five years to reach US$1.6 trillion in 2020.
In 2015, global business travel spend was US$1.2 trillion, a five per cent growth year-on-year.
Michael McCormick, GBTA executive director and COO, commented: “Business travel has demonstrated a tremendous resiliency as it continues slow and steady progress even in the face of global uncertainty, a weakened global economy, terrorist attacks, world health issues and other obstacles. Companies across the globe clearly understand the return on investment business travel delivers for their bottom line.”
Notably, China surpassed the US as the largest business travel market in 2015 with a US$291 billion market. However, GBTA expects China’s business travel market to become the fifth fastest-growing major market in the next five years as the country's economic growth moderates.
Elsewhere in Asia, GBTA predicts that India and Indonesia will average double-digit growth in business travel spending over the next five years.
While this forecast was compiled before the UK voted for Brexit, the report further stated that the uncertainty of the country’s economy may cause the postponement or cancellation of business trips. Should the UK enter a recession, domestic and outbound business travel will suffer, although a much weaker pound would attract more leisure and business travel to the country.
GBTA forecasts US business travel spending to grow only 0.9 per cent this year (US$292.5 billion) before advancing 4.2 per cent in 2017 (US$304.9 billion), owing to increasing risks in the domestic and global economies, uncertainty leading up to the US presidential election, Brexit and continued signs of a weakening global economy.
“The slow growth environment of the US and global economies has taken a toll on many fronts leading to this ‘new normal’ of slow, but steady one to two per cent progress,” said McCormick.