CHINA is likely to overtake the US as the biggest business travel market by 2020, with expenditure and investment in infrastructure already skyrocketing and secondary cities emerging as viable business destinations.
Said Hogg Robinson Group (HRG) China director of sales & account management, Yates Fei: “Despite a slowdown in the speed of economic growth in China, business travel to the region continues to increase.”
He added: “Figures from the GBTA (Global Business Travel Association) suggest China will become the world’s biggest travel market within three years.”
According to the World Travel and Tourism Council, business travel expenditure in the country leapt from US$18 billion in 2000 to US$62 billion in 2010, and this figure is expected to balloon to US$277 billion by 2020, eclipsing the US.
China is also setting aside substantial amounts for infrastructure investment. GBTA reports that US$237 billion has been earmarked for infrastructure development between 2011 and 2015, with a further US$239 billion committed to growing China’s high-speed rail network.
Boeing predicts that Chinese carriers will grow at an annual average of 8.9 per cent over the next 20 years, partly due to the burgeoning domestic market but also because of their sufficient resources to compete in the international market.
Air travel currently makes up 85 per cent of business trips, though rail travel should see a rise as Chinese authorities aim to have all cities with more than 500,000 inhabitants connected by 2020.
“China began investment in infrastructure a long time ago, with particular peaks before 2008 to accommodate demand from the Beijing Olympics, and the pace has picked up in recent years,” said Fei.
HRG also found that hotel rates were stabilising in Beijing and Shanghai, proof that the business travel landscape in China is maturing. Shenzhen, Guangzhou and Chengdu are the fastest emerging business travel destinations, witnessing significant corporate travel bookings over the last few years.