International Business Travel takes a dive in 2025

Tourism Australia’s release of its tourism visitor survey for the financial year 2025 isn’t good news for the business travel market. At 745,000 trips, travel numbers were down by 4% compared with the previous financial year, 2024. But even worse, the total spend from business travel for the year was down even more markedly, at 19%, to $1.8 billion. 

The 2025 dollar level is down by more than a quarter compared with financial year 2019, at a time when business travel was on an upward trend, with a 1.6% increase in visitation for that calendar year.

While disappointing, it is probably not all that surprising. Spending cutbacks, associated with corporate reduction pressures to reduce their carbon footprints were always going to have a greater impact for long haul markets like Australia. Combined with more sophisticated and reliable online connections, this direction may well be maintained.

That said, the decline certainly isn’t helped by constraints on international seat numbers.

But, despite the airline capacity shortage, there’s good news

Otherwise there’s a lot of very encouraging news in TA’s visitor survey reports, despite international airline seat numbers mostly stagnating around the 2019 figures.

In particular - where the rubber really hits the road - foreign tourism spend in Australia for the year to June was up by 22% compared with the 2019, pre-Covid, year.

That totalled a very healthy $37.5 billion, out of total annual exports of over $600 billion.

But what’s particularly interesting at a time when tourism bodies are seeking to attract higher value tourism is the average individual spend. Visitor spend grew 22% compared with the year of 2019, despite the fact that the number of trips was only 90% of the 2019 Level.

Despite China‘s slow recovery internationally, its visitors still delivered by far the largest contribution to tourism spending in Australia, with 26% of the total for year ending June. This, even though the number of seats flown between Australia and China is still around 10% below 2019 levels (although Australia-Singapore seats are up by about 6% and some Chinese traffic will leak through there).

Top 5 markets by spend in Australia 2025 vs 2024 periods

Source: Tourism Australia

This again serves to highlight the importance of China in our international trade; the distant second largest contributor was the UK at 7% of the total, with New Zealand and the US close behind.

International airline capacity remains a problem for both the airline industry and inbound tourism. The most notable drop has been in Australia-US seats, down by more than 20% compared with pre-Covid levels. This could partly be due to the Trump effect, but also to a slowing in the US economy.

It's likely to be some time before seat numbers increase greatly, so it’s encouraging to see an increase in unit spend, even if business travel trends downwards.