China’s business travel market has overtaken the United States to become the largest in the world, the Global Business Travel Association (GBTA) has revealed.
According to the latest GBTA BTI Outlook for China, the Asian country edged ahead the US in terms of total business travel spending at the end of 2015, by US$1 billion.
China’s business travel sector was worth US$291.2bn in 2015, compared with US$290.2bn in the US, but this gap is likely to continuing growing, with China’s business travel spending forecast to jump 10.1% in 2016, to US$320.7bn. In contrast, the US growth rate of 1.9% will see its business travel spending reach US$295.7bn this year.
“Despite a relative slowdown, China’s business travel market remains one of the fastest growing in the world,” said Michael W. McCormick, GBTA’s executive director & chief operating officer. “China surpassing the United States in business travel spending marks a major inflection point and truly demonstrates the global nature of today’s economy.”
The GBTA BTI Outlook also found that despite concerns over a “hard landing” for the Chinese economy, it appears that the country is actually experiencing a controlled moderation of growth, as planned by the government. GBTA said it expects that Chinese GDP will expand 6.4% in 2016 and a further 6.1% in 2017, “primarily from consumption and… government infrastructure investment”.
And this investment in travel infrastructure, according to GBTA, will drive the continued growth of business and leisure travel in the years ahead. It noted that more than 70% of Asia Pacific’s hotel construction pipeline can now be attributed to China, and that the development of new airports and high-speed railway lines continued at pace.
Business travel spend in China continues to be dominated by the domestic sector, which currently accounts for 95% of total business travel spend in the country. And while the forecast stated that the slower economic growth will “keep a lid on” domestic business travel growth, an annual growth rate of around 10% is expected in 2016 and 2017.
GBTA forecast of 9.8% growth in 2017 however, would mark the first year since the turn of the millennium that China’s business travel growth rate has dropped below double digits.