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Competition is already causing allegations and cat fights among Hong Kong’s venue owners even before the opening of the new AsiaWorld-Expo. Kevin Sinclair gets to the bottom of things.
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A dispute over the Trade Development Council (TDC)’s proposed HK$1.2 billion (US$154 million) plan to double the size of Hong Kong Convention and Exhibition Centre (HKCEC) has erupted between the city’s authorities and the French developers of AsiaWorld-Expo, a new centre being built close to Hong Kong International Airport.
In fact, when French minister for transport, tourism and maritime affairs, Mr Gilles de Robien, was in town recently, he dispensed with the usual diplomatic niceties to express concern to Hong Kong’s secretary for economic development, Mr Stephen Ip, about plans to double the size of HKCEC.
The controversy has been simmering for months because the huge French construction firm, Dragages, has invested US$38.5 million in AsiaWorld-Expo.
At the core of the dispute is speculation of secret agreements government officials may have made with the French partners over the future of exhibition space in Hong Kong. The rumours said “somebody” had promised the new company at the airport that HKCEC located at Wan Chai would not be allowed to expand for a number of years.
The escalating row has been made worse because of the recent in-principle approval given to TDC to convert the atrium between the land and mid-harbour sections of the Wan Chai centre into even more temporary exhibition space during peak seasons.
There are now rumours of a possible court case.
AsiaWorld-Expo chief executive, Mr Nicolas Borit, said: “As the expo project was still under way, plans were announced by the TDC to greatly expand the existing
convention facility at Wan Chai.”
AsiaWorld-Expo managers have denied any controversy and said they were confident they could cope with any unforeseen growth in the exhibition market.
There is a feeling that while conventioneers and fair goers would prefer the attractions of downtown events in Wan Chai, some organisers would rather opt for the greater convenience of the airport location.
The chairman of the Hong Kong Houseware and Gifts and Premium Fair organising committee, Mr Jeffrey Lam, who is also a TDC council member, maintains HKCEC’s expansion is needed because existing TDC show exhibitors like the Wan Chai location. He pointed out AsiaWorld-Expo was built to hold new exhibitions that have never been held in Hong Kong before.
Mr Lam said: “The French should not intervene, it is a commercial decision.”
HKCEC managing director, Mr Cliff Wallace, contends about a half dozen of the largest shows held there every year are “at this point virtually out of space”.
He said that was the reason 20,000m2 was being added.
Mr Wallace added: “We’re trying to provide for our existing customers who have indicated they want to remain at HKCEC.
This expansion would allow five of our exhibitions to become the largest of their kind in the world.
“Contrary to what AsiaWorld-Expo has said, that demand exists.”
Mr Wallace said his focus and priority would always be international exhibitions.
The squabbles, which have become public through escalating press coverage, seem to have baffled many of the large trade fairs, conventions, meetings and show organisers in Hong Kong.
One professional in the field, who declined to be named, said: “Surely it is in the overall interest of Hong Kong, the MICE (meetings, incentives, conventions and exhibitions) industry, the convention industry, the tourism industry and the travel industry for the city to have as many convention and fair outlets as possible?”
That is not how the parties concerned see it, apparently.
TDC had proposed in September the existing HKCEC be expanded.
This is now being studied by government officials, who must give their blessing for the additional space.
In a statement that infuriated backers of the airport facility, the TDC has made it known it had no plans to divert overflow demand for shows to AsiaWorld-Expo.
From next year to 2007, part of the Gifts and Premium Fair in April and the Electronics Fair in October will be held in air-conditioned, carpeted and weatherproof tents on the now-vacant land at Wan Chai.
There are waiting lists of more than 3,000 exhibitors for the two shows.
Essentially, it boils down to a fight for revenue.
Being the biggest player, TDC has traditionally garnered the lion’s share of shows, by far the majority of exhibitors and a vast percentage of profits.
The new centre being built threatens this.
AsiaWorld-Expo is due to host its first show in a year’s time.
It boasts 70,000m2 of rentable space and a 13,500-seat arena.
Its management is already marketing the airport-linked site as ideal for big meetings and it has snared a number of significant shows including the prestigious ITU Telecom World 2005.
AsiaWorld-Expo has claimed it has lured some customers from TDC.
This will put a dent in the estimated US$88 million the council garnered in revenue last year from trade fairs and exhibitions.
Either directly or indirectly, the Hong Kong government is, at the end of the day, the major investor in both facilities.
It has invested US$256 million of public funds in AsiaWorld-Expo.
