Unwise about MICE
View(s):“MICE’ in the literal sense could mean something small if one talks about rats and mice and this, unfortunately, is how the political establishment seems to perceive MICE of different sorts – the Meetings, Incentives, Conferences, Exhibitions or Events (MICE) industry. MICE is a huge market as big as leisure travel with a larger budget and greater potential. During the war-torn years, Sri Lanka was unable to push this market which requires absolute peace unlike the leisure market. However even after the civil conflict ended in 2009 and the country is more peaceful than some parts of Europe and the West Asia , governing politicians simply don’t understand the value of MICE market and its benefits. The biggest issue is the lack of larger, multi-purpose venues to cater to big events, lack of infrastructure and a proper taxation policy.
“We simply don’t have a proper strategy and policy to tap the MICE market,” noted a local MICE operator, saying that the high rate of taxation is not viable to stage events, a big component of MICE, here. For a leisure event, there is 11 per cent tax from the Colombo Municipality, 10 per cent Withholding Tax (WHT), 14 per cent VAT on ticket sales and for foreign remittances 10 WHT – making up over 45 per cent in taxes to stage an event. For many Sri Lankans, tourism is considered as tourists coming here on vacation and relaxing on beaches, the hill country or visiting the cultural triangle. Little attention and focus is on business travellers who pay foreign cash on business visits, to attend a convention, meeting or event or on incentives where corporate executives (accompanied by their spouses and sometimes family at their own expense) are fully funded by their companies as part of bonuses and other perks.
Revenue from hotels and exhibition or event space (BMICH, Sri Lanka Exhibition & Convention Centre –SLECC) is sizable coupled with hotel stays by participants and forays into shopping malls in Colombo. Approximately 15 per cent of foreign visitors are business travellers while a more accurate figure is possible since the on-line visa facility now also asks applicants to apply for a business visa with the same speed as a leisure traveller. The current hot topic in the MICE sector is the Rs. 3 billion allocated for a new convention centre in the 2016 budget. As in recent times, there was no proper study done by the authorities for such a venue though the budget spoke of “… establishing the necessary infrastructure to create a MICE Triangle consisting of the BMICH, Nelum Pokuna Theatre and the New Town Hall” and that the proposed facility will have a seating capacity of at least 7,000.
According to industry players, the space allocated is about 3-4 acres and unsuitable for a multi-purpose centre where an auditorium should be able to double up as a theatre, concert hall, meetings hall, dinner venue and exhibitions like venues in most of Sri Lanka’s competitors – Singapore or Dubai. The BMICH is Sri Lanka’s biggest venue with 1,500 being the maximum capacity. Compare that to Dubai’s upcoming convention centre (in addition to other large centres) where the break-out (smaller rooms) alone can accommodate 1,500 each while the main hall can seat 15,000. Singapore has equally large facilities; the same in other Asian cities barring South Asia. Sri Lanka has been nibbling at the crumbs – groups of 300 to 500 the most per event except for the 1,500 from Phillip India who spent three days in January 2015 in Sri Lanka at a convention held in 2-3 hotels (due to the lack of space to accommodate them in one venue); that too owing to the efforts of Walkers Tours which organized the entire programme.
Unlike other sectors, tourism has enough and more expertise to progress on its own without government expertise. Politicians always spoilt the soup in most sectors but in the case of tourism, the industry has shone in good times and bad times. Even in the MICE sector it’s the private sector that’s taking the lead, making suggestions and proposals but are the authorities listening? In the public sector too there are a few professionals who have joined hands with the private sector and helped steer this industry but have lacked support from the political establishment. Take promotion for instance, Sri Lanka is yet to come up with a proper country promotion campaign, 18 months into the current administration. The standard response when asked about a promotion campaign has been “why, we are taking part in every trade fair. That is good promotion”. The trade will tell you that this is a ridiculous policy because trade shows are merely to mark’s one presence and ensure another country doesn’t take away already secured business (if there is no presence at a trade fair).
A far bigger role is needed to raise the country’s profile and attract more visitors while the promotion and canvassing of MICE business has to happen separately or at the same time but as an independent campaign instead of lumping both leisure travel and business together – which is always the case with business travel being a poor cousin to the leisure sector. The current management of the Convention Bureau is trying to revive the business and focusing on India which makes sense as Sri Lanka’s powerful neighbor can provide the country enough business for the whole year if the right policies and infrastructure are in place. For the moment private sector groups like John Keells Holdings (successfully organized a travel bloggers conference with 60 foreign bloggers), Aitken Spence and Jetwing along with exhibition organisers like LEC and CDC are beating the drums abroad on Sri Lanka’s behalf to attract business.
What is required (only) is government facilitation to implement private sector proposals (if viable) rather than coming up with 3 to 4-acre venues which is probably enough only for parking space. The Sri Lanka Exhibition and Convention Centre near Lake House in Fort – equal to the seating capacity at the BMICH but with lack of parking space being its biggest drawback – will also be lost as a venue (in 3 to 4 years) when the whole area comes under a different plan under the Megapolis city concept. Rather than rushing to construct the newest centre, the government should tap into the private sector expertise and come up with a model centre that will serve the needs of the sector, as expected by the industry.longterm.