China passes a milestone in business travel
China supplies the largest number of (and total spending by) outbound tourists
According to data from the Global Business Travel Association (GBTA) China has overtaken the United States to become the world's largest business-travel market, though just about. The GBTA estimates that spending on business travel in China amounted to $291.2 billion last year compared with $290.2 billion in America. However, the Chinese market is set to grow by 10.1% and 9.8% in 2016 and 2017.
This comes amid a slowdown in the Chinese economy. Last year saw unprecedented measures taken to devalue the Chinese yuan. Burgeoning private debt has prompted the Economist Intelligence Unit, a sister company to The Economist, to identify the Chinese slowdown as the largest single risk to the global economy this year.
China's growth in business-travel spending should come as little surprise. China's state-supported domestic giants have international ambitions, prompting a slew of outbound acquisitions and IPOs led by the likes of Alibaba, the world's biggest e-commerce firm. But foreign interest in China has cooled and business travellers themselves may have noticed China dropping off itineraries in favour of India or markets in the Middle East and Africa. There has been a rising number of trips to India and Africa directly correlate with a declining number to Chinese cities.
In fact it is here that Chinese business travel is taking up the slack. The GBTA estimates that 95% of Chinese business travel is domestic, tapping into a groundswell of consumption in China's smaller cities in the interior and supported by a host of infrastructure projects that include a commitment from 2011 to build 82 Chinese airports. According to the GBTA China also accounts for 70% of the pipeline for hotel construction in the Asia-Pacific region.
The traditional dominance of white Western (or Japanese) male business-travellers will evolve quickly. As Chinese business travel rises and then moderates in the coming years it will be markets like India that will increase their own international presence, making for an increasingly diversified business-travel community.
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