China stakes its place

As a massive emerging market, China is developing its venues to become a key global exhibition destination. By Ben Moore While exhibition venue standards in Hong Kong set the pace for much of Asia Pacific, China is considered to be the key emerging market in the conference, exhibition and incentive (CEI) sector. With all emerging markets, however, concerns centre on whether the infrastructure, logistics and venue capabilities will meet the exacting demands of organisers and delegates. As a destination, China is riding high. Last year arrivals were up 14.7% to 72.8 million. According to the World Tourism Organization, China was the fifth most popular destination in the world in 1999. Forecasts suggest by 2020, China will be the top destination in the world, with 130 million annual arrivals. The country has 73 five-star hotels, including properties from the Starwood, Hilton, Shangri-La, Peninsula and Marriott groups. Transport links are good and air capacity to the two key cities have been improved following the opening of Shanghai Pudong International Airport and a new terminal at Beijing International Airport. "With the continued rapid development of China's economy, more and more wholesalers have placed China on the list of important destinations," says China National Tourism Administration (CNTA) deputy director of market research division Mr Man Hongwei. "Professional service standards, convenient transportation networks, varied travel activities and modernised communication systems have helped China organise and receive regional and international exhibitions of all levels. "Compared with neighbouring countries and regions, China has great advantages in terms of cost competitiveness. This is a result of co-ordination between the government, event organisers and hosting companies. "Being a member of Asian Association of Convention and Visitor Bureaus and an active participant in CEI events, China has attracted a great number of enterprises and well-trained staff who are playing a decisive role in offering high-quality services and skills. China is capable of meeting the demands of all levels in the CEI markets." Against this positive background, the Chinese exhibitions market is developing at a considerable pace. In 1999, China received 2.26million overseas meeting arrivals. Of these, 300,000 were attending the 750 major exhibitions staged last year. The majority of exhibitions (more than 300 events) were held in Beijing or Shanghai, underlining the two cities' importance for continued growth. This is a result of several factors, including easy access for buyers, advanced transport and telecommunications, and most suppliers are clustered around the two main cities. Beijing has six exhibition centres offering a combined floorspace of 180,000sqm, as well as a further 25 meeting venues. The largest - the Beijing International Exhibition Center (BIEC) - accounts for half (90,000sqm) of the city's available floorspace. Another venue attracting significant business from key multinational organisers is the China International Exhibition Centre (CIEC). The 15-year-old venue has hosted 350 international exhibitions within its 60,000sqm of indoor and 7,000sqm of outdoor exhibiting space. The eight-hall CIEC is part of a complex housing a 3,000sqm customs-bonded warehouse, booth-construction companies and a hotel. At the end of September, CIEC was the venue for the three-day ISH China. The event, for the international sanitation, heating and air-conditioning industries, welcomed 9,300 visitors and 178 exhibitors from 40 countries. The biennial show was run by Messe Frankfurt (HK) Ltd in association with the venue's own in-house organiser. "About 50% of the Messe Frankfurt events in Asia Pacific are in China. There are eight events and we are increasing this year on year," says Messe Frankfurt (HK) managing director trade fairs Mr Wolfram Diener. "We have well-established exhibitions in China, including ISH China, Intertextile Shanghai and Automechanika China, which contribute considerably to our revenues. "Shanghai as the trade capital will remain the major exhibition city in China, although none of the venues really meet international standards. Beijing, the political centre, is only a slightly less important location. The disadvantage of Beijing is terribly high hall rental and service fees. "Over the past 12 months, we have run five exhibitions in China. The basis for our success is a clear concept for each show with highly qualified visitors and first-class service. Our customers trust in us as a reliable partner in a market with many so-called professional exhibitions." The three main venues in Shanghai - Shanghai Everbright Convention & Exhibition Center, Shanghai Mart and Shanghai Intex - offer floorspace of 34,000sqm, 30,000sqm and 12,000sqm respectively. However these will be dwarfed by the end of next year when the Shanghai New International Expo Center (SNIEC) opens in the Pudong New Area. SNIEC is a joint venture between Shanghai Pudong Land Development and Messe Hannover, Messe Munchen and Messe Dusseldorf from Germany. The project includes 200,000sqm of indoor exhibition space and 50,000sqm outdoor. The first phase will make available 45,000sqm of indoor space and 20,000sqm outdoor. The facility will be served by international brand hotels in the Pudong area, including properties from the Shangri-La, Bass, Grand Hyatt, Hilton and Starwood groups. Shanghai has ten five-star hotels. The challenge however, is to overcome the legacy of China's past. Providing different space rates for local and overseas exhibition organisers is still a regular practice, with suppliers often providing twin quotes. The difference can be drastic - 50% less for local organisers. According to one industry source, the practice should wind down when China joins the World Trade Organization, although it may take five to six years. It is important for organisers not only to cater to the import intentions of overseas manufacturers, but also to make platforms for the Chinese industry to promote to global markets. The business environment in China has progressed tremendously over the past few years and it will continue to do so in the future.