The Global Business Travel Association (GBTA) Foundation announced the results of its latest GBTA BTI™ Outlook – China report, which projects China’s total business travel spend to grow 16.5 percent in 2014 – more than double the rate of China’s GDP growth.
The report, sponsored by Visa Inc., includes the GBTA BTI™; an index of business travel spending that distills market performance over a period of time.
Other key findings are;
• China’s recent announcement of 2013Q4 and full year GDP growth at 7.7 percent paints a picture of slow (by China standards), but steady growth.
• Throughout 2015, GBTA expects business travel spending to continue to pick up the pace, expanding 17.8 percent to $309 billion USD.
• As GBTA has previously forecasted, China is poised to overtake the U.S. as the number one business travel market in the world. Given our current projected growth in business travel in the two markets, we expect China to surpass the U.S. in spending as early as next year.
• The surge in Chinese business travel spending is driven by both domestic and international outbound travel with domestic being the main driver making up nearly 95 percent of the spending on Chinese business travel.
• China’s business travel market represents roughly 20 percent of the global business travel market, up from 5.1 percent in 2000, and total business travel spending grew by more than 16 percent per year over this period.
“The growth in China’s economy has been unprecedented, propelling the country’s business travel market to the second largest market in the world driven by real spending gains from rising business travel demand in both transient and group meetings and events,” said Welf J. Ebeling, regional director for GBTA Asia. “Even facing headwinds as of late due to restrictions on spending in the public sector, domestic business travel spending continues to grow, and international outbound also shows some promising signs of growth thanks to China’s improving export performance and improved economic performance among China’s key trading partners – the U.S. and Europe.”
“In line with the findings of this report, we’re seeing an increase in the number of corporate cards being issued to meet the needs of business travelers from China,” said Jeff Liao, Country Manager for Visa China. “As they adapt to the increasing amount of travel, organizations are finding electronic payments easier to track for expense purposes and it’s also a more flexible way for employees to pay for travel related expenses wherever they may be in the world.”
Over the last decade China’s largest airports have doubled in size and the construction of additional airports continues including Beijing’s second international airport, slated to begin this year and open in 2018. It will house half a dozen civilian runways – double the number at Beijing’s current airport relieving a tremendous amount of pressure on Beijing Capital International Airport, currently the second busiest airport in the world (ranked by passenger volume). In addition to airports, the latest available data from Lodging Econometrics (2013Q2) shows China had 1,695 hotel projects in the pipeline amounting to 435,000 additional rooms, hitting another historical peak.