Business travel in Asia Pacific is forecast for significant growth for 2023 and beyond, with travel spending gaining 41% to US$567 billion this year – and rising to US$800 billion by 2027.
This is according to regional forecasts and trends for APAC from the 2023 GBTA Business Travel Outlook (BTI) which were unveiled this week at the GBTA APAC Conference in Singapore by GBTA CEO, Suzanne Neufang.
China’s reopening and robust domestic demand will be a big catalyst for the growth. Solid rebound is also anticipated in Japan, South Korea, and Australia, along with the return of international business travel, which is anticipated to boost Singapore, Hong Kong and Malaysia.
In 2023, the Asia-Pacific region is expected to reach 92% of its 2019 business travel spending of $616 billion.
In 2022, the Asia-Pacific region continued to account for the largest share of global business travel spend, totalling US$402 billion or 39% of the global total. This is down significantly from the region’s 50% share of global spending 2021, however.
While business travel spending in the rest of the world grew at a rate of 80% in 2022, Asia Pacific’s spending increased only 15% from 2021 levels. The underperformance was fuelled by the economic shutdown in China and the subsequent decline of 4.6% in Chinese business travel spending last year.
Additionally, today’s business traveller in Asia-Pacific may spend less overall per business trip but may index higher on F&B, hotel expenses, as well as the desire for more premium options and blended (or “bleisure”) travel than their fellow corporate travellers in other global regions.
In a GBTA survey, Asia Pacific business travellers said on average they spent US$1,038 per trip last year, less per trip than North American travellers ($1,219), but more than Europe travellers ($888) and Latin American travellers ($661).
F&B expenses account for a larger share of per-trip cost in Asia Pacific (21%) than any other region including Latin America (17%), North America (17%), and Europe (18%). Air travel accounts for a similar share of per-trip cost in Asia Pacific (16%) and Europe (17%). However, it accounts for a higher percentage in North America (21%) and Latin America (26%) where employees likely travel further distances on business trips – especially international trips.
Lodging represents the highest percentage of per-trip spending in all four regions. However, the percentage is lower in Asia Pacific (32%) than North America (40%), Latin America (40%), and Europe (41%).
One-quarter of Asia Pacific-based business travellers (25%) say they booked their last work trip through “managed” channels (i.e., travel company or online booking tool). While higher than the share of Latin America-based travellers (19%) who did so, this is slightly lower than the share of North America (29%) and Europe-based travellers (32%). Similarly, Asia Pacific and Latin America travellers are more likely to book through retail channels.
Asia Pacific business travellers commonly fly premium. Of the Asia Pacific business travellers who took an airplane on their last work trip, two in five (40%) flew business class or first class. This is similar to the share of North America-based travellers (44%) who flew premium, but higher than the share of Europe-based (30%) or Latin America-based travellers (32%) who did so.
Similarly, almost two in five Asia Pacific-based business travellers (38%) stayed at an upscale or luxury hotel on their last work trip. This is similar to the share of North America-based travellers who did so (42%), and higher than the share of Europe-based (32%) and Latin America-based (24%) travellers.
Almost half of Asia Pacific-based business travellers (45%) extended a work trip for leisure time this year or last year. This is higher than the share of travellers who took a blended trip in any other region.
Around 70% are now traveling the same or more than the did in 2019, with 81% reporting business travel is worthwhile for them to achieve their business objectives.
The BTI annual report offers a comprehensive overview of business travel spending and growth across 72 countries and 44 industries and highlights the global business travel spending forecast and key trends for 2023-2027. Additionally, for 2023 the BTI also incorporates insights from a survey of 4,700 business travellers across five global regions including Asia Pacific, who reported their preferences, behaviours, spending habits, and the average cost of a business trip now.
