MICE industry recovers after years in doldrums

After years in the doldrums, Indonesia's Meeting, Incentive, Convention and Expo (MICE) industry has started to bounce back thanks to the improving economy and a more conducive security and political situation.

A peaceful environment following the successful general and presidential elections in 2004 and the government's tangible moves to deal with terrorism have encouraged more foreign visitors to attend meetings, conventions and exhibitions in Indonesia. This has had a positive impact for the MICE business.

The industry first saw signs of recovery in 2003 after fears arising from the Bali bombings started to subside in people's minds. The recovery continued in 2004, with about 500 events being held, far higher than the some 300 events that took place in 2003.

The number of foreign visitors attending MICE events also rose to 500,000 in 2004 from about 450,000 in 2003.

The Indonesia Congress and Convention Association (ICCA) estimates the number of visitors to MICE events will further increase by 20 percent this year, exceeding the growth rate recorded before the country's economic crisis in 1998.

"We hope the number of foreign tourists attending MICE events will further increase to 700,000 in 2006," said the association's chairman Iqbal Alan Abdullah.

He is upbeat that the MICE industry can contribute between 20 percent and 25 percent of the total revenues generated by the tourism industry starting from 2009 onwards provided that the government gives its full support to the industry.

Meanwhile, major event organizers such as Pacto Convex and Dyandra Promosindo said they would arrange more international events next year.

Among the major international events to be organized by Pacto Convec in 2006 will be ones related to medicine, healthcare and pharmaceuticals. But the company was unable to furnish additional information.

Djandra Promosindo expects to organize at least 30 events. "At least 30 companies have expressed an interest in collaborating with us on exhibitions. However, we have to study the proposals first before deciding which ones are feasible," said Dyandra Promosindo's business development manager, Hutami C.I. Santoso.

The event organizers expressed the hope that the government would give its full support to the development of MICE industry by improving the country's image and promoting it as a destination overseas.

"Our role in the private sector is to promote products," said Iqbal, also chairman of PT Royalindo, one of the major professional conference organizers in the country. "For this, we need the government's support."

The number of MICE-related visitor arrivals peaked at 520,000, or about 10 percent of total tourist arrivals of 5.18 million in 1997, with over 950 events held in that year, but dropped to 300,000 in 1998 with 200 events, and only increased slightly to 315,000 in 1999 with 215 events due to a combination of the economic crisis and security uncertainties following the change in the country's leadership in 1998.

The MICE industry began to pick up again in 2000, with 410,000 business-related visitor arrivals, or about 8 percent of the total number of foreign tourist arrivals of 5.06 million. However, the Sept. 11, 2001, terrorist attacks in the U.S. halted the positive trend.

Foreign tourist arrivals related to MICE events plunged to 200,000 in 2002 due to the Bali bombings and foreign media reports that Indonesia was a haven for international terrorist groups.

"MICE is a promising business. It is like a gold mine that has not yet been fully tapped," Iqbal explained.

Despite the small number of MICE visitors compared to leisure- related visitor arrivals, MICE visitors contributed more in revenue terms as visitors to MICE events spent more, he said.

The daily expenditure of MICE visitors was between US$400 and $500, compared to the around US$100 spent by other visitors.

Iqbal emphasized the importance of promoting the image of Indonesia overseas to attract more business travellers to the country.

"The government's efforts to show the world that Indonesia is not a haven for terrorist groups, for instance, has significantly helped to present a positive image of the country," he said.

With an improved image, Indonesia could look forward to hosting more international events, such as conferences and exhibitions, as the country would have greater bargaining power when bidding for international events.

"In order to host international events, Indonesia had to bid for them. A country with a good image and bargaining power has more opportunities of winning such bids," he said.

As a large country, Indonesia offers a great variety of venues for conferences and exhibitions thanks to the large number of provinces and cities that have the capacity to host MICE events.

Jakarta, Bali, Yogyakarta in Central Java, West Java, East Java, Medan in North Sumatra, Batam, Manado in North Sulawesi and Ujung Pandang in South Sulawesi were among the country's most popular MICE destinations.

Most five star hotels in the country's MICE destinations are equipped with superb meeting rooms and exhibition spaces. These venues cater to the needs of international visitors, whether for corporate meetings, workshops or training events.

"Each MICE destination has its own unique culture. This sort of uniqueness pleases overseas participants in conferences or exhibitions as the culture is different to their own," Iqbal said.

For large convention halls and exhibition arenas in Jakarta, there is the Jakarta Convention Center (JCC) on Jl. Gatot Subroto and the Jakarta International Expo (JIExpo) in Kemayoran, Central Jakarta.

The two centers feature all the supporting equipment and services needed for holding meetings, conferences, conventions, exhibitions and other events. They are both equipped with business centers and sophisticated technology like audio-visual, video conferencing and projector equipment.

The promising outlook has encouraged the country's major exhibition centers to upgrade their exhibition facilities.

PT JIExpo, for instance, will improve its venues and facilities to meet the diversified needs of convention and exhibition promoters, and to turn the center into the largest exhibition venue in the country.

Aside from improvements to the support infrastructure, the industry is also placing emphasis on the development of human resources.

Starting this year, the Indonesia Congress and Convention Association (ICCA), in cooperation with the State Polytechnic University Jakarta, is offering a diploma (D) 4 program majoring in MICE in a bid to solve the problem of insufficient numbers of professionals working in the MICE industry.

The D4 program is expected to produce more graduates with expertise in the MICE industry