China’s meetings industry is bracing itself for a tough two months ahead and sentiment is that 1H2020 could be a write-off due to cancelled and postponed events because of the Novel Coronavirus outbreak, first reported in Wuhan a few weeks ago and which has since spread outside the country.
However, industry players TTGmice contacted are confident the controls and measures which have since been put in place to stem its spread will be effective and are optimistic business can start to return to normal after 2Q2020.
Now in the midst of a week-long Spring Festival break, which has been extended to early-February, regional governments in the country have closed scenic spots and touristic activity is at a minimum.
A PCO director said the company needed time “to make an official announcement and there is nothing else I can say at this moment”.
“I am treating the situation seriously. Personally I think the MICE industry will be badly impacted in 1H2020,” she added.
A regional corporate travel manager shared that “all large gatherings have stopped”, in accordance with the government’s travel ban on travel in and out of China.
He added: “The start-work date for the Spring Festival break has been extended to early-February to give businesses time to put in place measures to handle the situation like disinfecting offices, setting up temperature checks at the entry, distributing masks, allowing staff to self-quarantine after returning from a trip, work from home, etc.
“We are also making plans for expatriates and families in the event the situation escalates.”
Even though Patrick Chen, director of marketing & promotion, Shanghai Municipal Administration of Culture & Tourism, said it was difficult to comment on how things will pan out, he believed the situation would be controlled soon.
“Most of us in Shanghai have already stopped moving about and are staying at home for two weeks to stop the spread of the virus.”
Commenting on the short-term outlook, Roger Shu, deputy general manager, Hangzhou Convention Exhibition & Travel, forecast the industry could start recovering in the second-quarter if the spread of the virus is curtailed.
But because China’s economy is facing “growth pressure”, there could be uncertainty.
Shu noted that if the impact was worse than expected, fiscal policy relief for the industry in the form of government funds and taxes might be needed.
Catering mainly to a western clientele, Sarah Keenlyside, founder and managing director, The Bespoke Travel Company, said: “A number of clients – mostly from the US and one booking from Israel – coming in February and March have decided to postpone until they have a clearer picture of what is going on.”
Keenlyside added that a corporate group of about 30 people had cancelled, but “clients planning to come in April have decided to keep their original plans so far”.
She continued: “Some clients are unfazed, but some don’t want to take the risk. For us, the bigger problem now is logistics. The fact that all tourists sights have been closed down leaves little for visitors to do.
“But we are pleased by the severity of the response. We are all hoping that it is short-term pain for long-term gain. The sooner the government can get the virus under control, the sooner things can go back to normal, and they are doing an impressive job so far.
“On the ground it feels as though everyone is really pulling together. There is a sense of solidarity among locals and foreigners; employers and employees; those in the travel industry – everyone – to work together to stamp this thing out as soon as possible.
“You won’t be surprised to hear that the main source of communication is WeChat, with all numerous group chats everyone is part of, which has proven invaluable.”
Founder of China Star Liu Ping shared the same optimism.
She said the PCO and DMC with events booked in March are giving clients the option to cancel, while those with dates further out were still mulling over what to do.
Even though the industry is facing a tough time now, she was confident of its resilience and did not foresee the current situation causing businesses to fold.
She added that the Chinese government was demonstrating the political will and capability to put in controls and measures to effectively tackle the situation.
Liu opined: “Compared to battling SARS, I am more optimistic, and that we won’t repeat the same mistakes.”
At press time, Liu was in Vancouver for a SITE meeting, said she shared with fellow participants her belief the outbreak could be controlled within the next two months and the spread reduced thereafter.
Even though she anticipated 1H2020 losses, Liu said China Star was in good shape and would not need to retrench staff, noting that the current crisis provided a good learning experience for her younger team members.
“The meetings industry is big and valuable and I am confident the tourism authorities will introduce the necessary support for its recovery,” she commented.