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Business travel spending in the UK is being forecast to rise by 1.9 per cent this year with growth expected to “accelerate” in 2014, according to the latest report by GBTA.
The study into corporate travel trends across western Europe predicts that Germany will see the biggest rise in business travel spending at 5 per cent, although expenditure is still set to decline in both Spain and Italy as their economies continue to struggle.
GBTA said that UK business travel spending should reach $41 billion this year, compared with €40.2 billion in 2012, with domestic travel set to rise at a faster rate than outbound travel.
The report adds that this growth should strengthen in 2014 to around $42 billion with international business travel from the UK forecast to rise by 3 per cent to $13.7 billion as well as a 4.4 per cent increase in $28.3 billion.
Catherine McGavock, GBTA’s regional director for Europe, said: “In the context of the struggling European economy our expectations for business travel spending in western Europe are relatively positive for 2013.
“There are signs of recovery in Germany and the UK, with both expected to experience growth in business travel spending this year. We believe that this is the beginning of a wider trend in the region and expect growth in business travel spending to accelerate in 2014 to the levels we saw before the eurozone crisis.”
GBTA is predicting that Spain will see a 6.2 per cent drop in business travel spending in 2013 while Italy will endure a reduction of 2.9 per cent. France is also expected to see a fall of 1.4 per cent due to its “exposure to the economies of southern Europe”.
But in 2014, these three major European markets are forecast to start spending more on business travel again, alongside continued growth in Germany and the UK.
Tad Fordyce, head of global commercial solutions for Visa Inc, which sponsored the GBTA report, added: “The results show that businesses throughout Europe are forecast to spend more on travel in 2013, starting a recovery that is projected to continue into 2014. Travel is a key driver of economic growth.”
The study said that the UK business travel market endured a "tough year" in 2012 as the eurozone crisis took its toll across the region.
"Domestic business travel performed relatively well but was offset by a 4.9 per cent drop in international outbound spending, which makes up roughly 35 per cent of the total," added the report.
"As expected, the Olympics had a negative net impact on business travel, as many would-be business travellers to London likely delayed or substituted trips to the congested region over the summer."