Global travel will grow 5.4 percent annually over the next 10 years as the number of Chinese households able to afford trips abroad more than doubles, according to a report commissioned Amadeus IT Holding SA.
China will surpass the U.S. this year as the world’s biggest outbound travel market and will become the biggest domestic market by 2017, the Oxford Economics report said. As many as 220 million Chinese households could afford to travel abroad in the next decade, the report said.
The international travel industry is likely to grow about 2 percent faster than global gross domestic product over the next decade and 1.3 percentage points ahead of the growth rate between 2009 and 2012. While China is poised to be the biggest driver of international travel, Russia, Brazil, India, Indonesia and Turkey will average 5 percent annual growth over the next 10 years as greater wealth and changing consumer behavior boosts interest in travel, Oxford Economics said.
“The travel industry has had a pretty difficult time in the past five years, post financial crisis, but clearly when we look at the findings of this report, the tide is turning and there is a very strong potential for growth,” Holger Taubmann, Senior Vice President Distribution at Amadeus, said at a press conference in London today.
Travel between west and east will spur demand for business travel, with Asia accounting for 55 percent of the increase in global corporate travel over the next ten years. Short-haul business travel in western economies will not recover to pre-2008 levels before 2018, according to the report.
“Shifting competitive dynamics and the persistence of new behaviors that emerged during the recession are both impacting key indicators in the sector,” Andrew Tessler, the report’s author and an associate director at Oxford economics, said in a press statement.
By 2023, countries outside the Organization for Economic Co-operation and Development will become the biggest source of international air traffic. South-to-South journeys accounted for 40 percent of global air travel over the past five years.