The Global Business Travel Association (“GBTA”), the world’s premier business travel and company meetings organisation, has released its latest GBTA BTI™ Outlook report on Brazil as portion of its semiannual series. Sponsored by Visa, key highlights include:
* GBTA BTI™ indicates that strengthening domestic and global economies will place Brazil on a robust growth path in 2013, with the index increasing by over 40 points
* Brazilian total business travel spending is predicted to grow 14.3% in 2013 to $34.5 billion
* Domestic business travel spending has grown 8.3% a year over the past 12 years, and is forecast to grow 12.9% to $27 billion in 2013
* International outbound travel spending is on course to expand by 20.2% in 2013, reaching $7.1 billion
* Demand for hotel rooms and air travel have been strengthening from both domestic and international outbound travelers; however there’s an increasingly large gap in supply
Brazil currently ranks 8th within the business travel global rankings, and is on the right track to surpass Italy, France and the united kingdom over the following two years
Wellington Costa, President of GBTA Brazil commented: “Brazil has shown remarkable economic resilience and we see this reflected inside the latest GBTA business travel data. Although business travel spending slowed toward the tip of 2012, growth rates for both travel spend and the economy are actually rising again. The foremost challenge facing the Brazilian business travel market is whether or not the country’s travel infrastructure and provide can keep pace with its growing demand.”
“Brazil remains to be a bright spot globally in terms of travel, with both domestic and international travel spending continuing to determine strong growth,” said Diego Rodríguez, Head of business Solutions, Visa Inc. Latin America and Caribbean. “According to the findings, Brazilian business travelers will surpass Italy, France and the united kingdom over a higher two years, because it continues rapid economic growth and development. With events akin to the 2014 FIFA World Cup and the Rio 2016 Olympic Games helping fuel both business and tourism travel, Visa is committed to helping Brazil maximize their economic potential with electronic payment infrastructure.”
While it seems that the present economy is weighing at the minds of travelers, for the primary 1/2 this year, we saw U.S. and international travelers increasing their spend on Visa accounts,” said Tad Fordyce, head of world commercial solutions at Visa Inc. “From January to June of 2012, international travelers increased travel spend on their Visa accounts by nine percent inside the U.S. to $20.1 billion. U.S. travelers were also active for the primary six months, increasing travel spend on their Visa accounts by seven percent to $17 billion. 2012 has the power to be the year of the traveler if we will continue this momentum of commercial and leisure travel.”
The route to growth
Despite the recessionary years of 2008 and 2009, Brazil’s business travel spending has continued to grow at a formidable rate, and has nearly tripled since 2000. From an estimated $11 billion in 2000 travel spend expanded at a regular rate of 8% per year to over $30 billion in 2012.
In 2013 growth rates are expected to come to double digit figures, boosted by upward trends in key economic indicators – particularly business confidence and employment – both highly correlated with business travel spend. Business travel spending is forecast to extend by 14.3% to $34.5 billion in 2013. This growth momentum will continue, with total business travel spending forecast to grow another 16.1% to $40 billion in 2014.
Moving up the sector rankings
Brazil’s business travel industry have been performing strongly in comparison to other developed markets. Brazil is currently ranked 8th on earth, up one place from 2011. With current growth rates, Brazil is forecast to continue its rise during the rankings as a huge business travel market, overtaking Italy, France and the united kingdom over the subsequent two years.
Challenges ahead
The forecast for Brazil is positive; however there are challenges which needs to be addressed if the business travel market is to achieve its full potential. The demand for hotel rooms and air travel have been strengthening from both domestic and international inbound travelers, and is about to extend over the following couple of years within the run-as much as the sector Cup and Olympics. The major challenge could be whether this demand can also be met going forward. Currently the provision of hotel rooms and air travel remains constrained, and the way through which that’s addressed will impact the ongoing growth of the business travel market in Brazil.