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Atlanta - Global business travel spending will reach a record $1.18trn this year, up nearly 7% from 2013, bolstered by growth in China, a US trade group said on Monday.
The Global Business Travel Association (GBTA) said it expects China, where business travel spending grew to $225bn in 2013 from $32bn in 2000, will top the US, which is currently the world's top individual market for business travel, by 2016.
Michael McCormick, executive director of the GBTA, said the strength of Asia in business travel reflects China's continued emergence as a financial centre. Asia-Pacific constitutes 38% of the business travel market, compared with 21% for North America and 24% for Western Europe, his group said.
Chinese growth
"The overall economy [in China] continues to grow," McCormick said. "It's the sheer multiplier effect that it has because there is double-digit growth in such a large market."
In the US, business travel spending rose 4.5% to $274bn in 2013. China, where business travel spending rose 15% to $225bn last year, is currently the second-biggest market. Japan was third with business travel spending of $61bn in 2013.
The group also said recovering business travel was likely to drive increases in airfares and average hotel rates, though it said fare increases would be mild should oil prices remain stable. US airlines such as Delta Air and hotel operator Starwood Hotels & Resorts last week said business travel helped fuel their quarterly profit increases.
Ukraine concern
The association cautioned that the current fighting in Ukraine was a hurdle to business activity in Russia and Europe. "An escalating Ukrainian crisis could push Europe and Russia into recession," the report stated.
The group added that business travel spending will keep rising over the next four years, advancing 8.6% in 2015, 7.1% in 2016, 6.9% in 2017 and 6.4% in 2018. In the last decade, the strongest years for business travel spending worldwide were 2007, which had 15.9% growth; 2004 with 11.4% growth; and 2006 with 9.5% growth.
The Global Business Travel Association (GBTA) said it expects China, where business travel spending grew to $225bn in 2013 from $32bn in 2000, will top the US, which is currently the world's top individual market for business travel, by 2016.
Michael McCormick, executive director of the GBTA, said the strength of Asia in business travel reflects China's continued emergence as a financial centre. Asia-Pacific constitutes 38% of the business travel market, compared with 21% for North America and 24% for Western Europe, his group said.
Chinese growth
"The overall economy [in China] continues to grow," McCormick said. "It's the sheer multiplier effect that it has because there is double-digit growth in such a large market."
In the US, business travel spending rose 4.5% to $274bn in 2013. China, where business travel spending rose 15% to $225bn last year, is currently the second-biggest market. Japan was third with business travel spending of $61bn in 2013.
The group also said recovering business travel was likely to drive increases in airfares and average hotel rates, though it said fare increases would be mild should oil prices remain stable. US airlines such as Delta Air and hotel operator Starwood Hotels & Resorts last week said business travel helped fuel their quarterly profit increases.
Ukraine concern
The association cautioned that the current fighting in Ukraine was a hurdle to business activity in Russia and Europe. "An escalating Ukrainian crisis could push Europe and Russia into recession," the report stated.
The group added that business travel spending will keep rising over the next four years, advancing 8.6% in 2015, 7.1% in 2016, 6.9% in 2017 and 6.4% in 2018. In the last decade, the strongest years for business travel spending worldwide were 2007, which had 15.9% growth; 2004 with 11.4% growth; and 2006 with 9.5% growth.
