Political instability ranks alongside natural disasters when it comes to attracting visitors to international events. For Thailand, the ongoing political struggle in Bangkok bears heavily on a country with a reputation as one of the world’s increasingly attractive exhibition locations. As this magazine went to press, the country’s Prime Minister Yingluck Shinawatra defied both demonstrators and the national election commission by confirming the snap election would continue on 2 February. She claimed postponing the election would not resolve civil unrest in the country, inflamed in the early weeks of the year as protestors called for her resignation and the removal of all government connections to her brother, ousted former PM Thaksin Shinawatra.
In reaction, the already overworked Thailand Convention and Exhibition Bureau (TCEB) released a statement advising organisers, delegates and attendees how best to avoid the protestors in the capital ahead of the general election, urging caution at a time when event organisers were withdrawing or postponing their events.
Major events such as the Thailand Open golf event went the way of December’s Race of Champions motorsport event. “We want to ensure the environment is stable in order to stage our world class tournament and national Open,” said Rungsrid Luxsitanonda, president of the Thailand Golf Association. A TCEB spokesman countered that “Bangkok is a large city, so it is possible for local residents and business travellers to avoid the demonstration areas,” adding that all major MICE venues and tourist attractions remain open. Predominantly peaceful or not, this civil unrest is a major thorn in the side of the country’s fundamentally sound and globally attractive profile as a host for global exhibitions.
The bureau will have its fingers crossed Shinawatra holds her resolve and the election brings about a conclusion to this marring chapter in Thailand’s political history, because 2015 is poised to bring about a change in the country’s fortunes. Next year Southeast Asia is subject to the formation of the ASEAN Economic Community (AEC), a body of 10 member states including Thailand that hopes to present a genuine challenge to the BRICs in Southeast Asia. Free-flowing investment, trade and manpower between Thailand and its AEC neighbours will entice international investment and enrich its offering for global event organisers.
The development of the AEC will enable Thailand’s exhibition industry to play a stronger hand. It will inevitably lead to improvement to Thailand’s already impressive transport infrastructure, built around strong road, sea and air connections. The same number of air passengers as people that live in the country – 65 million – land and connect through the capital Bangkok. Around 28 million of these stay in the country either on business or for vacation, a testament to the strength of Thailand as one of Asia’s most popular travel destinations.
Continuing the Thai Government’s desire to physically expand its commercial horizons ahead of the AEC going live in 2015, a US$62bn transport infrastructure development project is underway.
In the future, railways will connect from China down through Laos through Thailand down to Malaysia and Singapore on a north-south routing, and from Vietnam through Cambodia to Thailand crossing Myanmar to the Indian Ocean on the east-west route.” Exhibitions and events director at the Thailand Conventions and Exhibitions Bureau, Jaruwan Suwannasat. “The expected growth of tourism within intra-ASEAN is about 10 per cent in 2014, with business travellers contributing six per cent of that figure. We foresee an opportunity in getting new trade show profiles.”
According to David Aiken, MD and CEO of Asian Exhibition Services (AES), an operator headquartered in Bangkok with several events in Thailand, the ASEAN region accounts for 9.5 per cent of the global population (610 million people), while China comprises 20.7 per cent, India 18.8 per cent and the rest of Asia 4.9 per cent. Collectively it is the ninth largest economy in the world.
However, Aiken maintains ASEAN’s population strength is not only in numbers but diversity.
“The ASEAN region has huge variations in income, development, economic governance, political systems, religion, language, culture, colonial history and ethnicity. ASEAN’s economy is growing at five per cent a year, its level of foreign direct investment (FDI) per capita is US$131 compared to US$79 in China and US$22 in India. So with Thailand at the heart of ASEAN, Bangkok provides the ideal platform for international companies to penetrate this lucrative and highly important market,” he says.
Thailand’s population provides a considerable local consumption market and ample attendance figures at both its trade and consumer shows. Of course this figure is expected to rise with the advent of the AEC. The country has a robust economy, exporting around US$230bn of products and services globally. Its immediate neighbours Cambodia, Laos, Myanmar, and to a lesser extent Vietnam, rely on Thailand for imports of capital goods and services such as management expertise.
Strong sectors include agri-food, gifts and houseware, electronics and tourism, and its position in the heart of Southeast Asia, a growing manufacturing hub, makes it a powerhouse for industries such as automobile manufacturing, agriculture and food, information technology and medical.
Messe Cologne’s Asia Pacific regional director Michael Dreyer says as elsewhere, strong economic sectors have the highest potential to stage successful events. “At this point, successful events are either sourcing shows catering to the strong export sectors of Thailand, machinery events to satisfy the investment needs of the Thai industry, or consumer events catering for private consumption such as motor shows or fashion events,” he says.
“The oligopolistic structure of the majority of the Thai economy means that some parts of the Thai economy and trade are dominated by very few players. On the purchasing side (large family-owned conglomerates); some parts of the machinery trade are still dominated by trading houses who represent groups of manufacturers and thus control prices and market access. These structures are not beneficial for events.”
Most shows are held at Bangkok exhibition centres such as BITEC, Impact and the Queen Sirikit National Convention centre. In the future shows will also be held in Pattaya, Chiang Mai, Phuket and other provinces, as more suitable venues are developed.
Thailand’s position at the hub of the AEC is expected to help it compete with Asia’s single market giants. The ASEAN region is often referred to as the ‘missing BRIC market’ alongside Brazil, Russia, India and China. But the truth is that the economic, industrial and cultural diversity in the region makes it a distinct proposition all of its own.
And as Aiken points out, aside from the rest of the ASEAN region, Thailand is itself a fast-developing market offering tremendous business opportunities to foreign companies, despite the colourful political backdrop. It continues to demonstrate extreme resilience and growth through business-friendly policies and a strong export-driven economy, and with the arrival of the AEC, its stock will rise.
The country remains perhaps the major gateway to the growth markets of Southeast Asia, now pushing itself as the regional exhibitions gateway to the wider markets of South Asia, south China and the Far East. Its exhibitions regularly draw large numbers from India, China, Japan and South Korea as well as the more immediate markets of Indonesia, Vietnam, Malaysia, Singapore, the Philippines and Myanmar. It offers international airport links, five-star venues, rail and metro services directly from the airport and hotels to most of the centres, as well as excellent hospitality and accommodation for the international participants.
“Thailand is the hub for Southeast Asia, not all of Asia,” says Sarnit Karunyavanij, VNU Exhibitions’ business development director, Asia Pacific. “Singapore is a good place for exhibitions in industries such as finance, telecommunications and oil and gas, but most manufacturing shows organised in Thailand yield a higher number of trade buyers and users. The cost of attending a show in Thailand is significantly less, so it makes sense for buyers to visit shows in Bangkok.”
Removing the red shirts
But whether the industry puts its money in Thailand and the ASEAN region or looks to the BRICS, exhibitions are built on the concept of attracting visitors. An end to Bangkok’s political feud is what’s needed to ensure organisers focus on Thailand. “At the moment the [political] ‘development’ in Thailand is definitely contrary to increasing the country’s appeal to international organisers,” comments Dreyer. “Koelnmesse has been active in Thailand for more than 10 years and we’ve experienced our fair share of these ‘developments’, postponing an event and making special arrangements to ensure safe passage of our customers. Political instability is the biggest obstacle.”
One thing’s for certain, an end to unrest in the capital can’t come soon enough for international organisers.
This was first published in issue 1/2014 of EW. Any comments? Email exhibitionworld@mashmedia.net
