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Asia Pacific corporate travel in strong rebound, technology and digitization will drive future
It was a strong start to the GBTA (Global Business Travel Association) Asia Pacific Summit this week in Singapore as the industry body shared data that showed, all things being equal, the slowest recovering region will reach 92% of pre-pandemic levels by year end.
Suzanne Neufang, CEO of GBTA, called it a “momentous time to bring the business travel community into one room in Singapore”.
Suzanne Neufang: “The future is yet to come but it’s looking bright.”
In 2022, APAC, which represents 39% of global business, was down by 50% over 2021 and even though global spending grew by 80% in 2022, APAC only grew by 15%. However a significant rebound is expected this year and the region should be back to 92% of business travel spend of US$616b, she said to the room of nearly 400 delegates from 17 countries.
This comeback is happening against a healthier-than-expected recovery globally, driven by the return of in-person meetings and events and international business travel.
According to the GBTA Business Travel Index Outlook, strong gains continued in 2023 and a 32% growth in global expenditures is expected on top of the $1.03 trillion spending in 2022. “By 2024, spending will return to pre-pandemic level of $1.4 trillion, 18 months earlier than projected,” said Neufang, “and by 2027, spending is forecast to grow to nearly $1.8 trillion.
“The future is yet to come, but it’s looking bright.”
From left, Bertrand Saillet of FCM Asia, Chavi Jaba, Visa and Rajeev Menon, Marriott International.
However there are some dark clouds, as pointed out by Bertrand Saillet, managing director, FCM Asia. He said that while domestic business travel in the region had exceeded 2019 levels, full cross-border recovery is being hampered by government actions. “Air capacity is not fully back, it’s not a problem of demand getting those routes back but there are governments protecting airlines.
“Access to visas is also an issue – in China, it takes a minimum of six months to get a visa to Schengen and the US. And there are geo-political issues to watch – the strained relations between India and China, making it difficult for travel between both countries. We cannot leverage on those two markets – there will be much greater opportunities when these things get solved.”
Technology and digitization will play a big role in shaping the future of corporate travel in Asia, he said. “There are two airlines in APAC – Qantas and Singapore Airlines – leading the implementation of NDC distribution and that has to be watched for the changes it will bring.”
Meantime, there’s no running away from the fact that the use of technology by customers has accelerated. “The adoption and usage of our mobile app has exploded, which is a good thing because we invested a lot of money and finally, technology is getting adopted by corporate travellers in the region,” said Saillet.
Rajeev Menon, president, Asia Pacific for Marriott International, said there has a discernible increase in travellers booking direct with 52% of room nights coming from its Bonvoy progamme. A similar trend is being seen in corporate travel bookings coming direct, he said.
For Chavi Java, Senior Vice President, Head of Commercial & Money Movement Solutions, Asia Pacific at Visa, the largest opportunity in corporate travel is digitisation particularly in payments. “We hardly see cash anymore, the trend is towards contactless payments so we need to be digital first.”
Virtual cards and digital wallets will be critical moving forward, she added.
And now that business has recovered and things have settled down – last year was one big scramble to rebuild and re-hire talent to manage the return of business – Saillet said companies now can also focus on sustainability. “Asia was lagging behind, but now we’re back and we can do what we must.”
Neufang observed that globally, dynamic forces were also at work to change the industry – the way we work, advances in tech and automation, sustainability, fragmentation vs retailing and the traveller experience.
Specific to sustainability, she said in GBTA’s State of Climate Action study, 92% of buyers and suppliers said this was a priority. “Sustainably managed business travel is a force for good,” she said.
This focus, as well as widespread use of virtual meeting technologies, growth in remote work and rise of new forms of blended travel, would shape the future of corporate travel.
Meanwhile, Mark Cuschieri, the first non-American president to head GBTA, and UK-based executive director for global travel at UBS, said that APAC is playing a pivotal role in shaping the future of business travel and that the association is piloting a global equity programme in the region to bring in “new, diverse voices”.
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