SINGAPORE — The rate of decline in Asia’s travel industry should slow in the second half of this year as the global economy stabilises, but risks remain, a top industry player said Thursday.
Abacus International, an Asian air ticketing and reservations firm, forecast travel bookings from July to December would fall between 4.0 and 6.0 percent from a year earlier, compared with the 10 percent drop seen in the first half.
“It’s true that there is evidence of green shoots sprouting and lining the path that the industry is travelling on right now, which is great news,” said Abacus president and chief executive Robert Bailey.
“However, this road is still likely to be a bumpy one.”
The risks include terrorist attacks like the hotel bombings in Jakarta last month and a further escalation of the swine flu virus.
Despite the travel industry being hammered by the global economic slump, there were also bright spots, with Vietnam, Thailand, Myanmar, Sri Lanka, the Philippines, China, Pakistan, Nepal and Kazakhstan registering travel growth in the first half, he said.
More people were also booking for short-haul and domestic trips, he said.
Corporate travel, however, will remain subdued and could recover only by mid-2010, Bailey told reporters.
Companies are scrutinising business trips more closely and this practice is likely to stay even after the global economy recovers, he added.
“The financial pressures faced by companies have forced them to be more stringent about granting permission for staff travel,” Bailey said.
Markets like Singapore and Hong Kong, which draw the bulk of the business travellers, have been the most affected “and will continue to feel that pain for some time,” he said.
“When will it upturn? I would say we’re looking well into mid-2010 before that comes back.”
Premium airlines have suffered from the decline in the number of corporate clients as they derive a bulk of their income from business class travellers, analysts have said.