GBTA Forecasts Overall Fall in Business Travel Spend Across Major European Markets in 2012, but Expects Markets to Improve in 2013
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GBTA Forecasts Overall Fall in Business Travel Spend Across Major European Markets in 2012, but Expects Markets to Improve in 2013

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4 Pages
English

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GBTA Forecasts Overall Fall in Business Travel Spend Across Major European Markets in 2012, but Expects Markets to Improve in 2013 PR Newswire LONDON, September 20, 2012 LONDON, September 20, 2012 /PRNewswire/ -- Report finds strong correlation between job growth, exports, and business travel spend across Western European markets The Global Business Travel Association ("GBTA"), the world's premier business travel and corporate meetings organization, announces the results of its second GBTA BTI™ Outlook - Western Europe report, a semi-annual analysis of the five most critical business travel markets in Europe: Germany, the UK, France, Italy and Spain. These five markets together form the lion's share of business travel in Europe, nearly 70%, and provide a barometer for the health of the entire European business travel market. The report, sponsored by Visa Inc., includes the GBTA BTI™, an index of business travel spending that distills market performance over a period of time. Highlights Germany, France and the UK are expected to see positive GDP growth in 2012, albeit under the 1.0% level Interdependencies in trade, banking, and distribution have cast a shadow over the region. As such, 2012 GDP growth expectation for the Euro Area (17 country definition) has been downgraded following the Spring 2012 report to -0.4% Italy and Spain are currently in recession and expected to remain so until 2014 Overall business travel spend among major European markets will fall 2.

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GBTA Forecasts Overall Fall in Business
Travel Spend Across Major European Markets
in 2012, but Expects Markets to Improve in
2013
PR Newswire
LONDON, September 20, 2012
LONDON
,
September 20, 2012
/PRNewswire/ --
Report finds strong correlation between job growth, exports, and business
travel spend across Western European markets
The Global Business Travel Association ("GBTA"), the world's premier business
travel and corporate meetings organization, announces the results of its second
GBTA BTI™ Outlook -
Western Europe
report, a semi-annual analysis of the five
most critical business travel markets in
Europe
:
Germany
, the UK,
France
,
Italy
and
Spain
. These five markets together form the lion's share of business travel
in
Europe
, nearly 70%, and provide a barometer for the health of the entire
European business travel market. The report, sponsored by Visa Inc., includes
the GBTA BTI™, an index of business travel spending that distills market
performance over a period of time.
Highlights
Germany
,
France
and the UK are expected to see positive GDP growth in 2012, albeit
under the 1.0% level
Interdependencies in trade, banking, and distribution have cast a shadow over the
region. As such, 2012 GDP growth expectation for the Euro Area (17 country definition)
has been downgraded following the Spring 2012 report to -0.4%
Italy
and
Spain
are currently in recession and expected to remain so until 2014
Overall business travel spend among major European markets will fall 2.2% in 2012 to
$177 billion USD
before bouncing back by 1.4% in 2013
German business travel spend is expected to rise 1.6% to hit
$50.8 billion USD
in
2012, before growing 3.3% in 2013
UK business travel spend is expected to remain flat in 2012 (
$40.2 billion USD
) before
growing 2.8% in 2013
France
business travel spend will fall -2.2% to
$17.9 billion USD
in 2012, before
growing 1.1% in 2013
Spain
business travel spend will decline -7.8% in 2012 to
$17.9 billion USD
before
falling another 1.6% in 2013
Italian business travel spend will fall -6.9% in 2012 to
$32.9 billion USD
and will shed
another -1.2% in 2013
Paul Tilstone, managing director of GBTA Europe, commented: "
Europe
has
unfolded pretty much as we expected in our inaugural Spring 2012 report.
However, as a result of weaker first half prospects in
Spain
,
Italy
,
France
and
the UK, our 2012 GDP growth expectation for the entire Euro Area has been
downgraded slightly in the Fall report to -0.4%, from -0.3%. We are confident
that the second analysis of the region, in our semi-annual report series,
continues to provide strong, accurate insights into both short- and long-term
trends in domestic and international outbound business travel activity."
Tilstone continued, "However, with lingering debt challenges and continued
austerity measures, the European economy will likely continue to be challenged
for years to come. The GBTA's fall report therefore remains cautious, with
overall business travel spend forecast to increase by 1.4% in
Western Europe
in
2013."
Domestic business travel and job growth
European unemployment is arguably one of the Continent's key social and
economic concerns. Only
Germany
has succeeded in bringing down
unemployment since the Great Recession, but even its progress has slowed
through 2011 and 2012.
Spain's
unemployment rate has risen to nearly 25%,
Greece
is at 22% and
Portugal
at 15%. Despite modest GDP growth
expectations, even
France
and the
United Kingdom
are not expected to make
progress on unemployment until 2014 or beyond.
International outbound business travel and exports
Export growth logged a welcome surprise in Q2-2012 for
Germany
and
Spain
.
Germany's
trade position is more globally diversified with larger export
proportions going to the world's most dynamic emerging markets, which is not
the case for most other Euro Area countries whose trade is more dependent on
intraregional relationships.
Country-Level Business Travel Outlooks
Germany
GBTA forecasts German business travel spending to grow by 1.6% in 2012 to
$50.8
billion
and 3.3% in 2013 to
$52.5 billion
Domestic business travel spending will grow an estimated 2.8% in 2012
International outbound spending in
Germany
will decline -3.0% in 2012
Business travel spending in
Germany
has been supported by relatively strong
industrial and service sectors and is spread across a number of large commercial hubs
including
Frankfurt
,
Munich
and
Berlin
United Kingdom
The UK has the second highest level of spending on business travel in
Western
Europe
with
$40.2 billion
in 2011
The UK maintains a large volume of trade on the European continent resulting in a high
proportion of spending on international outbound business travel (35% in 2011)
The GBTA forecasts total spending on business travel in the UK to remain flat in 2012.
International outbound travel from the UK will fall -3.1% and domestic business travel
spending will grow 1.6%
Moving into 2013, GBTA predicts growth to pick up pace (2.8%), with domestic
business travel gaining 2.3% and spending on international outbound business travel
gaining 3.9%
France
Business travel spend in
France
is expected to suffer a loss of -2.2% in 2012 with total
spending on business travel falling to
$35.7 billion
Business travel in
France
will continue to recover along with the broader European
economy in 2013 and will grow an estimated 1.1% to
$35.1 billion
Any recovery in French business travel spending will be driven by domestic travel,
which is expected to be flat in 2012 followed by growth of 4.5% in 2013
GBTA forecasts outbound international travel from
France
to fall -5.7% in 2012 and
another -4.6% in 2013
Spain
Southern Europe
will remain in recession until at least late 2013
GBTA expects spending on Spanish business travel will decrease by -7.8% in 2012,
falling to
$17.9 billion
Spending on total domestic business travel in
Spain
to drop by -5.9% in 2012 followed
by a drop of -0.4% in 2013
International outbound business travel from
Spain
, which has grown to make up one-
fifth of total Spanish business travel, will fall at an even greater rate than domestic, -
14.4% in 2012 followed by a drop of -6.2% in 2013
Outbound international travel will suffer due to a weak domestic economy, slower
growth in
China
and the US and a relatively weaker Euro
Italy
Much like
Spain
, although to a lesser degree, the situation in
Italy
continues to get
worse rather than better
It is expected that austerity measures will continue to take their toll on the corporate
sector and corporate travel budgets though the rest of 2012 - resulting in business travel
spend losses of -6.9% in 2012, followed by -1.2% in 2013
Spending on domestic business travel in
Italy
will fall -6.5% in 2012 ,followed by
another -0.8% drop in 2013
Spending on international outbound business travel, which will also suffer from a
weaker Euro, will fall -10% in 2012 and -3.9% in 2013