Travel spending is key indicator for hospitality industry

16 April 2010

Sentiment is improving in the region as companies resume spending on corporate travel

The results of MEED’s Business Travel Survey, which was carried out in early March, show that corporate travel spending is set to rise this year, as companies lift travel bans imposed in response to the global economic crisis. Some 62 per cent of respondents to the survey say they expect to spend more on business travel in 2010 than last year.

This is positive news for the region’s hospitality industry, much of which is geared around conferences and exhibitions. Hosting a large annual event is a big revenue generator for hotels and restaurant takings, and occupancy usually soars as a result.

In 2009, attendance at most conferences and exhibitions was markedly lower than previous years, but with travel budgets reinstated, participation is likely to improve this year.

That business people are getting back out on the road also bodes well for the wider economy. After 18 months of cutbacks, project delays and cancellations, the business world is moving again, discussions are being held and deals are being made again.

Unsurprisingly, the respondents say the most likely countries to be visited in the GCC by representatives of their company during 2010 are the UAE, Saudi Arabia and Qatar, showing that these three countries continue to be the region’s leading business hubs. More interestingly, the countries of the wider Middle East that come out highest are Egypt, Libya and Jordan. Clearly, the senior company executives surveyed by MEED see them as offering significant business opportunities.

Economies are driven by the collective power of companies; and when they stop spending, the wheels stop turning. More than providing an insight into the fortunes of the Middle East travel market, the results of MEED’s Business Travel Survey provide an insight into the sentiment at companies with operations in the region, which will ultimately play a part in determining the performance of its economy.

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