The future of the Philippine MICE industry in the midst of a pandemic

Is the country’s Meetings, Incentives, Conventions and Exhibition/Events (MICE) industry dead?

by Monette Iturralde-Hamlin / July 23, 2020

In 2018, the Philippine Association of Convention/Exhibition Organizers and Suppliers, Inc. (PACEOS) initiated the MICE Roadmap 2030, in collaboration with the Department of Tourism (DOT), the Tourism Promotions Board Philippines (TPB), the Board of Investments (BOI) and the Department of Trade and Industry (DTI).  The Roadmap trained the spotlight on the important socio-economic contribution of MICE or business events to gross domestic product (GDP), employment and country branding, and laid the strategy needed to position the Philippines as a leading MICE destination in Asia Pacific and the Middle East.  Priority actions for maximizing the potential contribution and strengthening the country’s global competitiveness were set: provide enabling policies and institutional support; accelerate infrastructure improvements, develop a highly competitive human resource, and strengthen R&D. With this global pandemic, what happens to these plans now?

When the pandemic hit and the metropolis was locked down, the Philippine MICE industry essentially went into hibernation. The naysayers even said MICE was dead. Events were cancelled as people were not allowed to travel. Expressing concern about travel security, closed borders and two-week required quarantines, international speakers, sponsors, exhibitors, and visitors either cancelled their engagements or decided to adopt a wait-and-see attitude.  Organizers scrambled to move their events to later in the year as large convention centers and sports complexes were converted into quarantine areas first for returning overseas Filipino workers, and then for asymptomatic positive cases. Hotels, restaurants, travel and tour operators closed their doors for business.

What everyone thought to be a short month-long lockdown beginning March 16, 2020, kept getting extended every 15 days. It has been four months now, and the end is not yet clear. As countries started closing their borders and the rise of deaths from COVID-19 quickly escalated, it became evident that this was going to be a long drawn out battle with an unseen enemy.

Proactively, PACEOS (full disclosure: I am currently PACEOS VP for Conventions, and was on the TPB board for three years representing MICE) quickly got together to discuss how the pandemic was affecting our members and how to handle it, and to meet with DOT and TPB to seek assistance for the industry.  A quick estimate revealed the devastating effects of the pandemic. For the two major MICE venues alone in NCR, nearly P450M worth of revenues was lost, equivalent to over 250 events. On top of this, add the lost shipping and logistics revenues, as well as, the potential P8.1B in potential business generated from exhibitions and conventions. Organizers estimate over P1.35B gross revenues lost from cancelled events in 2020, while highly event-dependent players like booth contractors, freight forwarders, catering companies, production houses, and even freelance talents struggle to survive. DOT estimates a 66% decline in tourism revenues. For smaller MICE players, this pandemic could mean business closure.

Facing a bleak future of cancelled/postponed events and the financial burden of keeping their employees and paying for overhead, many members availed of the two-month wage subsidy extended by the Department of Labor and Employment and SSS, while some were forced to furlough their employees. In a bid for help, PACEOS submitted recommendations for Financial Assistance for MICE companies to include additional wage subsidies; event subsidies to cover potential losses from reduced exhibitor/delegate participation; 3-year zero interest loan packages to cover salaries, overhead and other initiatives after ECQ and as seed money to restart the business after COVID-19; reduced income and VAT taxes as respite to cover losses and to encourage more exhibitor and delegate attendance caused by low budgets and exhausted finances during ECQ/GCQ.  

To jumpstart the industry, PACEOS lobbied the IATF through DOT to include conventions, exhibitions and B2B trade shows in the list of industries allowed to open and operate, distinguishing them from mass gatherings like concerts, festivals and carnivals. To prove that business events can take place safely and securely in controlled venues, we collaborated on a detailed manual of MICE Hygiene and Safety Protocols that covered procedures for space, time and people management to abide by social distancing and health requirements. 

Recently, DOT issued its Memorandum Circular No. 2020 – 006 called New Normal Health and Safety Guidelines for MICE Organizers and MICE Venues/Facilities, largely incorporating the recommendations we submitted. In addition,  DOT issued Administrative Order 2020-003 allowing mass gatherings including work conferences under a Modified General Community Quarantine (MGQC), provided that participants shall be limited to fifty percent (50%) of the seating or venue capacity; while areas under ECQ, MECQ, and GCQ can only conduct MICE events through an online platform where no physical interaction among participants is involved.  To date, Metro Manila remains under GCQ.

While Asian neighbors like China, Hong Kong, Korea, Malaysia, Thailand and Vietnam have already opened their MICE industry, the Philippines remains closed and hesitant, reeling from its fight against COVID-19.  On July 13, the Philippines marked SouthEast Asia’s biggest jump in daily COVID-19 deaths, and the most number of active cases after Singapore and Indonesia, after movement restrictions were eased in the country’s economic center in hopes of restarting the country’s badly-hit economy. Given this, IATF does not look like it will ease up on its ban on business events.

Despite all the negativity, pockets of good news and positivity are spurting up. 

First, the pandemic brought industry players and government closer together, leading to open and frank discussions, data sharing and collaboration amongst would-be rivals. Smaller players have organized themselves in Events Bounce Back.

Second, the pandemic fast-tracked the adoption of technology and digital transformation as industry players scrambled to bring their events to the virtual stage. Organizers and associations are holding virtual conferences and webinars, cutting down the usual six month planning and preparation stage to a month or just a few weeks, as well as, on the expenses of mounting a live event. Even exhibition organizers are beginning to explore virtual exhibitions, seeing increased interest from exhibitors and visitors who no longer have to spend on travel and accommodations.

Third, with technology creating a level playing field for all organizers, the country’s inadequate number of large-scale MICE venues and poor transport infrastructures no longer matter as online platforms replace them, although we still need to contend with slow and expensive Internet connection.

Fourth, DOT has launched an aggressive certification training program for MICE players, encouraging them to upskill during this downtime

 Fifth, airlines, MICE venues, hotels and restaurants are stepping up on their safety, health and hygiene procedures under the new normal, promoting these in a bid to regain consumer confidence. And some venues say they are beginning to see live events happen, such as worship gatherings.

As a friend in the MICE industry says, “There is a future in MICE. The question is when will that start, and what help will the government give the MICE industry?”