Global business travel market 'likely to see pronounced growth'

Global business travel sector to boom (Image: iStock/anyaberkut)
Phone:+45 4363 2266

Travel Management Companies (TMCs) are likely to see a significant uptick in business travel revenues over the next couple of years.

This is according to a new report from the Global Business Travel Association (GBTA), which has indicated that the market is on the cusp of a recovery after a slow performance in 2016. However, a number of economic factors are creating uncertainty around the forecast, meaning businesses may be wise to remain wary in the short term.

Analysis from GBTA indicated that global business travel spending came to $1.3 trillion (£989.2 billion) in 2016, which was only 3.5 per cent higher than 2015's figure. However, the rate of spending is expected to accelerate significantly in 2018 by 6.1 per cent, followed by growth rate of around seven per cent in both 2019 and 2020 - the highest gain seen since 2011.

This rise is coinciding with a growing optimism surrounding the global economy, with consumers spending more, trade and investment ticking upwards, corporate profits and management sentiment experiencing strength and commodity prices stabilising

Moreover, the recent recessions in Brazil, Russia and Argentina have ended, while China - which ranked as the largest business travel market in the world in 2016 for the second straight year - is experiencing better performance.

However, GBTA warned that the Global Economic Policy Uncertainty Index - founded in 1997 - has hit an all-time high, with trade policy renegotiation, travel and immigration bans, sanctions, electronics bans and geopolitical tensions all mounting. As such, it is possible that further risks might be just around the corner for TMCs, despite the overall feeling of optimism.

Michael McCormick, executive director and chief operating officer of GBTA, said: "Global business travel remains a critical driver of the success of organisations around the globe.

"Stronger footing in emerging markets and continued economic stimulus in the developed world has supported global stability, leading to a positive forecast that is unfortunately clouded with more uncertainty than we have seen in decades."

ProCon Solution A/S
Herstedøstervej 27-29
DK-2620 Albertslund
Phone: +45 4363 2266