Alicia Yao, vice president of the China Business Event Industry Committee, and managing director of IME Consulting, discusses the pace at which China is recovering, and what steps international destinations need to take to help cross-border business travel flow freely again
China seems to be functioning relatively well, driven by a huge domestic market. What is the pace of recovery like for the domestic business events industry?
So far so good. About 80 per cent of our domestic travel and MICE industry has recovered. While new technology for hybrid meetings and exhibitions are more commonplace and organisers have started to create more attractive and vivid hybrid events, people still prefer face-to-face meetings. Currently, it is difficult to organise large meetings, due to the stricter control of event sizes due to Covid-19.
Meanwhile, exhibitions are running at around 50 per cent their usual size, with other exhibitions being conducted online.
We want foreign exhibitors and sellers to return to China for face-to-face meetings, but they are unable to enter China at this present time. This is one of the challenges that is hindering the recovery of international exhibitions and meetings.
About 700 million Chinese have been vaccinated so far and the government is aiming to have 80 per cent of the population vaccinated by the end of 2021. This is because China has to make sure that we can open our doors to foreigners, as we will be hosting major events such as the Winter Olympics in Beijing, Asian Games in Hangzhou, and FISU World University Games in Chengdu in 2022.
What changes have you noticed in the business events sector?
Many Chinese corporate incentive programmes that used to go to Thailand, Malaysia, Japan, Korea and Europe, have had to turn to domestic destinations. Larger incentive groups of 6,000 to 7,000 have been seen heading to Macau and Sanya.
Currently, a number of cities and small towns in China have come up with special policies that support meetings and conventions, including monetary grants or in kind, varied tour offerings, and new events technology.
I think Chongqing, Xiamen, Chengdu, Hangzhou, Suzhou, Guizhou, Kuming, Hainan and Macau are destinations that would appeal to domestic corporate groups during this time.
China remains the largest global source of leisure tourists second only to the US, and international travel from China is expected to return to the pre-Covid-19 levels by 2023. What about outbound business events?
Previously, during the economic slowdown, leisure travel in China was expected to recover ahead of business travel. However, now that the economy has recovered, it looks like business travel will recover to pre-pandemic levels first, then leisure travel. And once outbound leisure tourism has recovered, outbound corporate incentive travel can then recover.
Previously, leisure travel used to bounce back quicker than business travel, but due to the instability and long-term nature of the pandemic, coupled with the dire need for economic recovery, business travel is expected to recover ahead of leisure travel this time around.
I think we will see a gradual recovery in outbound business events by end of this year or next year. But this is also dependent on the opening of borders and how countries can effectively control the virus, and whether insurance companies are able to provide the right coverage for safe international travel to resume.
While it is business as usual in China, if Chinese businessmen are unable to travel abroad, their investments abroad will also cease. And we all know how the transnational flow of business travel is important to economic recovery.
How can overseas destinations tap into China’s outbound business events and adapt to the globally-changing landscape?
According to the World Health Organization, Covid-19 will be around for years, but borders cannot be shut forever or the world economy will never recover.
On the destinations’ end, governments, convention bureaus, and tourism organisations have to work out the best way for international travel to safely resume. This may include developing a unified SOP (standard operating procedures) that will protect inbound corporate and business events travellers, such as appointing hotels and DMCs to provide dedicated services for this group of travellers.
On the travellers’ end, they need to be responsible for their own testing and making sure they test negative, and get themselves vaccinated. Corporate travel managers and travel management companies would also need to work with insurance companies to ensure that there is product that would appropriately cover a corporate traveller’s needs. There’s no such product in the market now, which makes it even harder for corporate incentives to take place.
To hear more of what Yao has to say, tune in to the virtual IT&CM China session happening from June 22-24, 2021. Yao will be speaking at two sessions, and the programme for the event can be found here.