China is expected to lead the business travel recovery, and investment by both global and local companies in China should increase over the next 12 months, according to American Express Business Travel (AEBT). AEBT announced the results of two surveys evaluating the economic and business travel outlook of both global and China-based clients at their fifth annual China Business Travel Forum. Sixty-eight percent of respondents in one study anticipate that China’s economic prospects would be better than those of the U.S., followed by India.
“Economic conditions over the past year have undoubtedly impacted the travel and entertainment industry on a global scale, however increase in demand will help to drive business and encourage investments, particularly in China,” said Charles Petruccelli, president of American Express Global Travel Services. “As we look ahead to next year, we believe travel spend will play a crucial role in fueling recovery not only in China, but on a broader scale as countries begin to emerge from the recessionary environment. Businesses that will be best placed to take advantage of business opportunities in China, the U.S., or anywhere will strike the right balance between supporting necessary business-generating travel with applying smarter controls that don’t deplete the bottom line.”
Additional Findings of the GBP Survey incude:
Most global companies believe the worst of the economic crisis is over with 79 percent of executives predicting a modest economic expansion over the next 12 months. However, this does not mean spending will reflect this attitude, as 50 percent of respondents said that their company will decrease travel spending over the next year by more than 10 percent and 25 percent stated that travel spending will stay the same over the coming year.
Meetings and events are reported as seeing the brunt of cutbacks, with the survey stating more than 70 percent of companies have an opportunity to better control spending on meetings and events, a far larger percentage than those who felt they could cut back on air or hotel to control their costs.
Respondents were split on when their company will start hiring to support growth as 25 percent predicted they would be hiring again come first quarter of 2010 and 36 percent said they will continue to hold off on hiring until 2011.
Eighty-nine percent of companies surveyed expect their companies to invest in China over the next 12 months while 79 percent say they will invest in India over the next year. A further 46 percent stated that China would be a top priority for international expansion in the short term.