Skift Take

Business travel spending has increased tremendously in India and Brazil since 2000 — but most of that money is spent domestically. As those and other markets continue to change — and global politics shift — will the future bring more or fewer international business trips?

Two of the world’s largest emerging economies had very different years when it came to business travel.

A pair of new reports from the Global Business Travel Association show the disparate trajectories of the business travel markets in India, which is on the rise, and Brazil, which declined last year.

Spending forecasts for India’s business travel market in 2016 continued to improve, with even stronger growth expected in 2017.

Overall spending on business travel that originated in India was expected to reach $33 billion in 2016, an increase of more than 11 percent compared to the previous year. That’s driven by a 12 percent increase in domestic spending, which makes up the vast majority of business travel in the country. International outbound spending was expected to be up 5.4 percent.

Big gains are forecast for this year too: spending is expected to be up 11.6 percent in 2017.

The report said infrastructure spending, market-based reforms, and a good relationship with the U.S. — particularly with President Donald Trump — should help the economy keep its momentum in 2017.

The anticipated 2016 numbers would bump India up to the ninth biggest spender on business travel in the globe. The report says India is likely to keep climbing the ranks, becoming the world’s sixth largest business travel market by the time 2019 is over.

“Naturally, we expect India’s ranking to improve as the country continues to invest in its infrastructure,” the report said. “This new infrastructure will be critical to accommodate the growth in India’s travel and tourism sector.”

The forecast was far more tempered for Brazil — downgraded, in fact, for the second time in a row as an economic recession, political instability, and weak demand for commodities persist.

For 2016, spending on business travel that originated in Brazil is expected to be down almost 11 percent to $27 billion. Spending on domestic travel — the bulk of business travel — will fall 12 percent, the outlook says, and spending on international outbound travel is expected to be down 5 percent.

Brazil’s recession has hit domestic business travel hard after a robust stretch of development.

“This growth has stagnated over the last few years, and Brazil’s business travel market is backsliding and losing much of the momentum gained early in the new millennium,” the report says.

The decline means Brazil is expected to drop to the No. 10 spot on the list of the biggest business travel spenders in the world — right behind India.

This year could bring a slight turnaround: The forecast calls for overall spending on business travel that originates in Brazil to increase 1.5 percent in 2017.

Along with Russia and China, Brazil and India have seen business travel spending experience a “meteoric rise” in the last 10 years. But the India outlook highlights how the situation has changed more recently. China has become the biggest spender in the world.

“There was a clear divergence in late 2013 and early 2014 when India maintained its rapid growth while both Russia and Brazil witnessed declines in business travel activity as their economies went into recession,” the report says. “Both Russia and Brazil have been negatively impacted by falling oil prices and continuing problems with corruption. Russia also faced sanctions, while Brazil grappled with political instability.”

feed

Skift India Report

The Skift India Report is your go-to newsletter for all news related to travel, tourism, airlines, and hospitality in India.

Have a confidential tip for Skift? Get in touch

Tags: brazil, business travel, gbta, india

Photo credit: Business travel spending fell in Brazil and increased in India in 2016. Pictured is the Santos Dumont airport in Rio de Janeiro. Rodrigo Soldon 2 / Flickr

Up Next

Loading next stories