According to a new Visa report, some 109 million
Asia Pacific households are expected to go on an international
trip once a year by 2025, up 65% from 2015.
Over the same period, Visa's report, Mapping the
Future of Global Travel and Tourism in Asia Pacific, which
forecasts travel and tourism trends in the next 10 years (2015 to
2025), found average annual spending by households during a trip
is likely to rise 8% to US$5,230.
The report also identified key drivers expected
to impact global travel, including a growing middle class, greater
internet connectivity, improved transportation infrastructure
across many countries and an aging global population with more
time for leisure travel.
"Travelling internationally will
become more common and attainable in the future thanks to changing
demographics, combined with technology advances that make
travelling abroad easier and less expensive," said Wayne Best ,
Chief Economist, Visa Inc. "What will emerge is an expanding
travelling class that will spend a growing portion of their
household income on cross-border travel. Tomorrow's travelling
class will likely be older and hail from emerging markets -
looking very different from today's typical international
In Asia Pacific, households in mainland China
(US$255 billion), Hong Kong (US$47.4 billion) and Singapore (US$44.9 billion) are likely to be the top markets with the
largest outbound travel spend by 2025. However, emerging markets
Indonesia (211%), Vietnam (132%) and India (101%) are likely to be
experience the sharpest increases in spending.
spend among top five Asia Pacific markets (according to 2025
values) with households earning US$20,000 or more annually by
projected 2025 spend. Figures are based on constant 2015 prices.
Highlights of the global report include:
of New Global Travelling Class: Growing income levels around the
world is creating a new travelling class. The study uncovered
that worldwide, households that make at least US$20,000 per year
account for more than 90% of spending on international travel
today. By 2025, it is estimated that nearly half of all global
households (945 million) will be within this income range,
spurring greater international travel and spending, particularly
by households from emerging markets.
Global Aging: By 2025,
travellers aged 65 and above will more than double their
international travel to an estimated 180 million trips, accounting
for one-in-eight international trips globally. The study estimates
that older travellers will be able to afford longer trips that
provide greater comfort at higher prices. Trends such as medical
tourism whereby aging populations undertake international travel
for medical purposes will also take hold in the future.
Increasing Connectivity: The combined forces of globalisation and
technology are expanding access. Construction of more than 340
new airports is expected over the next decade, creating new routes
and destinations that will make international travel easier and
more convenient. At the same time, awareness of travel options is
spreading with the continued rapid uptake in internet access and the number
of mobile devices around the world. Digital connectivity is not
only fostering greater spontaneity in travel, but also spurring a
broader array of personalised travel and tourism options as well.
Visa estimates the number of households
travelling internationally by comparing Visa-branded cardholders
in a given country who have made at least one face-to-face
transaction abroad versus the population of all active cardholders
in the source country. The figures were adjusted to be
representative of the source country's population regardless of
payment methods used by households. The propensities were then
used as an input in the forecasts developed by Oxford Economics
for the study.
Oxford Economics used survey data on the age and
income of the international travelers from a sample of 10
countries to calculate international travel frequencies and share
of travel by age bracket and income class. The results were
extrapolated to a broader set of countries based on their
classification as developed or emerging markets and key variables
such as GDP per capita and total international arrivals per
capita. The estimated travel shares were then compared with each
country's household income distribution and age distribution to
develop a historical relationship from which to project
international travel shares and volumes by income class and age
bracket from 2005 to 2025.
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