While policymakers wrangle over the feasibility of integrating the different market systems under the" 9+2" structure of the Greater Bay Area, a bigger question for the business events industry lies in the impact of such an initiative on Hong Kong’s status as a hub for events.
The “9+2 structure” in question spans Hong Kong, Macau and nine mainland cities in Guangdong, prompting Stanley Chu, chairman, Adsale Exhibition Services, to liken it to a football team, except that the 11 players hardly communicate with each other.
Speaking during the GBA panel at the HKECIA Conference in Hong Kong last Friday, Chu pointed out that the business events industry, like any other sector, is shaped by the economic development of the region. With China at its backyard serving as the factory of the world for the past 30 years, Hong Kong has always thrived as the hub of sourcing fairs for consumer products.
More recently, however, the mainland is slowly emerging from its manufacturing shadows. Shenzhen, the southern city just across the border from Hong Kong has instead become home to a booming tech sector. Come September next year, the 400,000-square meter Shenzhen World Exhibition and Convention Centre will be open for business with 19 units of exhibition spaces.
“We have to understand the mechanism of our business, the exhibition business is a platform business, we connect the exhibitors and visitors over this platform,” said Chu.
Despite China’s great leap in technology, it will not change overnight as the world factory for a lot of consumer products but it has to provide more high-end services in design and creative sectors for trade shows in Hong Kong, Chu added.
“On the other hand, we [the business events sector)] has to help the other industries to grow by bringing in more resources, that is how we can think about the strategy for the 11 players,” he said.
At the moment, Chu and his fellow panelists Michael Duck, EVP, UBM Asia and Mao Daben, executive deputy general manager, Shenzhen Zhaohua International Exhibition, do not think of Shenzhen as a serious rival to Hong Kong simply because the latter is far superior in financial and legislative infrastructure conducive for international fairs.
In fact, Chu strongly believed that it is hard for the GBA plan to take off unless all the 11 cities come together as a single market.
“Certainly some products (and fairs) will be in China whether it is GBA or not, as we have seen Shanghai and Beijing evolve,” said Duck.
While Hong Kong is not a huge marker in industrial fairs, it is more common in China to serve its domestic industrial needs. Duck noted most of the exhibition shows held in Hong Kong are international in nature, which is why the city will always draw a buyer audience.
Speaking to Campaign Asia-Pacific later, Duck was ambivalent about any real benefits from new infrastructure development such as the high speed rail from Hong Kong to Shenzhen and the Hong Kong-Zhuhai-Macau bridge which will be open this year is more promising as a PR exercise on the MICE sector.
This is because visitors flying in to Hong Kong are more likely to travel directly to Macau and Shenzhen from the airport than making extra trips to the city to board the new facilities.
Likewise, Mao, who is overseeing the development of the Shenzhen World Exhibition and Convention Centre, was more pragmatic about the potential of this great piece of real estate.
In this case, size could be a problem from a maintenance perspective as well as making sure a decent turnout all year round. Mao said that he wants all kinda of shows across all industries "because it is such a huge venue".
However, he was not very optimistic about getting shows in Beijing and Shanghai to move to Shenzhen, as those two locations are more likely competitors of Hong Kong’s rather than Shenzhen.
Meanwhile, the 105,000-sqm Shenzhen Convention and Exhibition Centre has remained in operation for the past 15 years.
The venues in Shenzhen, however, are under the purview of a government regulated theme protection clause within six weeks before and after a certain fair, said Mao. This means that exhibitions with a similar theme can't be held at the venues within the buffer period.
“As a venue operator, the organisers are our God, we have to listen to them. If they like [the] protection, then we have to do it,” said Mao.
However, human talent currently remains an acute problem to get the place up and running. “We lack capacity in hospitality and many other things related to exhibitions. For the operations team, we probably need 200 people, it is very hard to find enough people in Shenzhen and we have to attract talent from all over China, it’s really a huge challenge,” said Mao.
The discussion of the evening nevertheless did not end on a bleak note. Chu from Adsale Exhibition Services was hopeful for the growth of the industry as a whole as long as Hong Kong is thriving on the back of a prosperous China.
“With the One Belt One Road initiative, there are more factories moving to China. There are certainly more international buyers in the GBA than Shanghai, we are in a position to play. Therefore we have to segmentise the exhibition market and see what segments we can dominate. That’s the way to go forward,” Chu said.