In the decade before the 2008 global financial crisis 1 per cent of Americans’ spending was on overseas travel: now it is 1.4 per cent. Tourism is growing even faster in some other countries.

There has been a broad-based rise in experience spending. Within that, tourism has got cheaper with deregulation helping low-cost airlines while price-comparison websites highlight bargain fares and hotels plus home-sharing. The internet and blogs introduce us to new destinations that the young feature on social media. The world is more accessible as yesterday’s warzones become today’s tourist hotspots.

Meanwhile, more retirees and even more millennials have the means to travel. These trends primarily affect the developed world, where travel now makes up a greater share of the average spend and aging populations are richer and perhaps healthier than previous generations. But across the emerging world too younger consumers can now spend much more on travel.

Where are they visiting? Australia and New Zealand have seen a five-year annualised growth exceeding 10 per cent for arrivals from China and India – trends that look set to continue.

France, Spain and the US receive the most from visitors but they are large economies and tourism is a relatively small share. Thailand is the major economy where tourist spending is the highest proportion of GDP – 13.7 per cent.

Most economies with a large share of GDP from tourism are very small – such as Macau, the Maldives and many Caribbean states. In Europe, visitors to Montenegro, Croatia and Iceland contribute more than 10 per cent of GDP. Although tourism – and overtourism – present environmental risks, visitors boost businesses and create jobs, even if it helps some countries more than others.

China accounted for only 7 per cent of global outbound travel last year but its travellers made 10 per cent of global outbound expenditure. Spending per trip by Chinese travellers abroad has consistently exceeded other nationals’ since 2013, reaching 30 per cent more than the US and 25 per cent more than the rest of the world in 2018.

And while Chinese tourists spent USD 120 billion abroad in 2017, they spent another USD 720 billion at home.

Outbound travel from China has grown steadily for two decades. Relative to South Korea and Japan, the proportion of China’s population going abroad is still low but we expect continued mid-single-digit growth until at least 2025.

Nearby countries will benefit, but as consumers become wealthier, travel to regions outside Asia should increase too, with Europe winning a bigger share of visits. However, current tensions with Washington mean we expect almost 5 per cent fewer visits to the US this year.

As more Chinese consumers become wealthier, travel and experiences will dominate their preferences: in our latest China Deluxe survey, more than 60 per cent of respondents put travel among their top three purchases if their economic situation improved.

And there is a clear age bias, with the Chinese under-35s more eager to travel abroad than older generations. A combination of the rising incomes of this demographic and easier travel will push global tourism.

International tourist arrivals rose by 6 per cent last year to 1.4 billion: the World Tourism Organisation estimated in 2010 that they would reach 1.8 billion by 2030, but growth is already above that trend rate.

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