As emerging markets continue to mature, the Gulf Cooperation Council’s (GCC) role as a bridge between the East and the West becomes ever more valuable. Two thirds of the world’s population are only an eight-hour flight away from Dubai, and the emirate’s government has focused its efforts on turning Dubai into a tourism and transit hub. The goal is to attract 20 million visitors a year by 2020, not bad for a country with just 2.5 million residents. Now, others in the region are following suit with infrastructure investment programmes of their own.

Hotel operators are focusing their attention on generating business from meetings, incentives, conferences and exhibitions (MICE), which is a highly profitable, but overlooked sector. While business travellers make up a bulk of visitors to the GCC, and their numbers continue to rise, the big conferences and exhibitions where buyers and sellers negotiate and close deals are taking place in the hotels and conference centres of Western Europe and the US. According to a 2015 report by Strategy&, a consultancy firm owned by PwC, only 2% of all exhibitions in the world take place in the Middle East with Europe and the US accounting for a combined 80%.

In Strategy&’s 2015 report, ‘Playing to win in the meetings industry game’, senior partner Richard Shediac was quoted as saying: “Currently, only about 5% of the travellers arriving in countries in any given year fall into the MICE category. Yet these travellers spend more than other tourists, staying at the luxury hotels where meetings often take place, and dining at expensive restaurants, which make them more desirable customers. In Las Vegas, which is one of the US’s most popular cities for meetings, the average MICE tourist spends $174 a day, compared with $148 spent by other tourists.”

Financial muscle

The political will to develop the MICE market is there, backed up by financial muscle. Towards the end of last year, the Doha Exhibition and Convention Centre, which cost $630 million, opened with the capacity to house seven jumbo jets in its main hall. The venue currently competes with the Qatar National Convention Centre, which features nine exhibition halls and a 4,000-seater theatre, and will face further competition from the Oman Convention & Exhibition Centre, which is set to open its exhibition hall in the third quarter of this year, and its auditorium, meeting rooms and ballrooms in 2017. Riyadh’s primary conference venue is also undergoing expansion, while Bahrain is planning its own facility.

The intention to develop world-class venues is clear and prevalent, however, the marketing approaches differ between countries. “Oman is talking more about the cultural side of things and the beauty of the country, whereas a country like Qatar is specifically targeting the conferences and exhibitions side of things because that’s what its infrastructure is best suited to,” says Shinu Pillai, regional head at Reed Travel Exhibitions, which puts on IBTM Arabia, the biggest MICE industry conference in the region: “All of these countries have one thing in common; they’ve identified MICE as a strong opportunity, and somewhere they can really get into those verticals of tourism. All the major projects we’re talking about are funded by the government. There is a wilful, planned approach in making sure these elements are in place.”

There is little evidence of hotels in the GCC actively trying to attract MICE business, which is unusual given that the majority have the space to hold conferences or exhibitions, and the number of rooms required for delegates. Dubai is an exception. Apart from offering competitive rates and good transport, the best operators become involved in the event. The Jumeira Rotana, for example, provides in-house support for events, takes a hands-on approach and positions itself as a partner of the organiser rather than just a venue with rooms to rent.

Pillai says that, because of the competition in Dubai, it’s not simply about having the right number of rooms of the correct size. It is more about ensuring that the organiser hosts a successful event. He says: “Something we discussed last week with a venue was when you’ve got more than ten delegates checking in at one time, what do we do to avoid a queue? Or once you know that your guest is out for a meeting, can we make sure that’s when we turn down the room? These add to the experience of your delegates, and your organiser values that level of true involvement.”

There are big infrastructural gaps to be filled. Cities such as Riyadh, for example, have many luxury hotels but few in the three-star range. Such properties are proving popular for smaller meetings and conferences or for those lasting only a day or two. Outside the UAE, there is a notable dearth of destination-management companies that can handle all of the logistics for corporate events. Organising conferences is still dominated by a handful of big names. The commitment of governments to MICE will hopefully embolden more market entrants, which will increase competition and set high standards.

Issues of practicality

Once the hotels have been built, operators still need people to visit, but this is not straightforward. It is dependent, to some extent, on broader economic considerations. There is a clear correlation between the amount of trade a country conducts and the success of its MICE business; the conferences a hotel hosts are often closely linked to its most successful economic sectors. For example, according to the Strategy& report, the top export categories of Thailand, Taiwan and Canada – respectively agriculture, electronic components and natural resources – are also the most popular types of exhibitions in those countries.

Alternative approach

The reasons for this are obvious. If, for example, a conference on agriculture were being held in Qatar, which has a small sector without many companies present in the area, then speakers, exhibitors and delegates couldn’t be sure of reaching the right people, so they would be unlikely to attend. Hence, GCC conference producers (Dubai excluded) are likely, at least until their economies diversify, to focus primarily on oil and gas and industries that are less specific to geography, such as finance. An alternative approach is to focus on niche sectors as MICE Arabia, a Saudi Arabia-based conference producer, has been doing. Such events may be smaller, but they are likely to bring specialised delegates from a broader range of countries.

“More specific exhibitions; that’s what our clients are looking for,” says Elliott Rizk, senior vice-president of sales and administration at MICE Arabia. “We had the Big-5 Saudi construction exhibition going on, and we also launched a dedicated HVACR [heating, ventilation, air conditioning and refrigeration] exhibition. Nowadays, the visitor doesn’t just want to come over to the exhibition and conduct deals – they want to learn, to grow and see what’s new.”

The opposite approach is to employ interesting or quirky venues, attracting people by offering an overall experience rather than just an interesting conference or networking opportunity. The Guggenheim Museum in Abu Dhabi, which is yet to open, will make a fine setting for a cocktail reception, as would Muscat’s opera house. It might be more of a struggle for countries such as Qatar and Kuwait, however, which don’t yet have the wealth of options to become destinations in their own right.  

“An alternative energy or healthcare official attending a congress in Madrid can expect to go to an event at the Thyssen Bornemisza Museum and be surrounded by fine art,” says Shediac. “By contrast, it is unlikely that congress attendees in the GCC will find themselves guided to a similarly impressive location. Most GCC countries do not think about their unconventional venues in this way yet.”

Schengen-style visa

In some parts of the region, there are still considerable legal and regulatory obstacles to the growth of MICE.

Although the GCC is currently exploring the idea of a Schengen-style visa that allows foreign visitors to explore all six member states on a single document, current entry processes differ from country to country and it can be tricky, particularly for delegates from outside the GCC, to gain entry. In the Saudi market, there is the significant question of women’s rights, though Rizk says that this can be worked around.

“We do have hotels that cater to women, floors dedicated to women,” he says. “We also have compounds here that can be rented out on a nightly basis, like a hotel, where women can stay and walk around freely. We are seeing the rise of women as powerful business travellers.”

Outside of Dubai, MICE business in the GCC is in its infancy. There are a number of infrastructural and regulatory hurdles to overcome, but with financial support and enthusiasm from governments, increased economic diversification and new trade flows, robust growth is expected during the next few years.