Growth Pace Is Slowing in China

CHENGDU, China—Few would disagree with Intl. Assn. of Exhibitions and Events President Steven Hacker, who said, “The transformation of China is one of the most remarkable events in history,” during closing ceremonies of the China Expo Forum for Intl. Cooperation (CEFCO) held here Jan. 14-16.

However, just as many Chinese officials and economists are careful about making projections for this year in the larger economy, leaders of the country's convention and exhibitions industry were equally cautious about making statements indicating that 2008 will see the same kind of fast-paced growth as years past.

“Growth in C&E (conventions and exhibitions) will become more rational,” said Wang Jinzhen, vice chairman of the China Council for the Promotion of Intl. Trade, during this year's CEFCO meeting, the largest annual event in the Chinese exhibitions industry. “2008 will be a year of consolidation for our industry.”

The CCPIT's annual report on the Chinese exhibitions industry, released during CEFCO, noted that while 2007 was a very good year – in fact, the pace of growth was faster than in 2006 – this year is expected to be a bit quieter. The comments by Wang and others at the meeting attended by about 650 tradeshow professionals echo those made by others speaking of China's place in the global economy.

China's Natl. Bureau of Statistics has said it expects the country's gross domestic product to grow by about 9 percent in 2008, less than what bureau officials believe was an 11.4-percent GDP expansion for China in 2007.

Pointing out that all of China's convention centers are operating at only 10- to 20-percent capacity, Wang said now is a perfect time to focus on increased quality of services in the exhibitions industry if it is to attract more international participants.

Now that the country is close to having almost as much exhibition space as it can use – if not more than enough – revenue growth for the industry is likely to come in large part from more foreign participation in shows, Wang added.

CCPIT's annual report pointed out that 28 percent of foreign exhibitors spend at least 200,000 yuan ($27,800) to exhibit at the average Chinese tradeshow, while only 9 percent of domestic exhibitors spend more than 200,000 yuan. Around 20 percent of foreign tradeshow attendees spend at least 20,000 yuan ($2,780) to visit the average show, but only 5 percent of domestic attendees spend that much. The report found that 71 percent of domestic tradeshow visitors spent less than 3,000 yuan ($415).

Westerners attending CEFCO agreed that the focus in the next few years should shift to improving the quality of services.

Messe Munchen Chairman and CEO Manfred Wutzlholfer said, “International exhibitors do harbor high expectations about exhibitions.”

There are at least three explanations for the relative pause in the growth of the Chinese exhibitions industry, according to Wang and others.

First is the slowdown in venue construction. Second, a number of annual exhibitions will not be held this year in order to accommodate the Summer Olympic Games in Beijing.

Finally, the decline of the global economy in general is certain to have an impact on the Chinese exhibition industry, according to Zheng Shijun, vice president of the China Intl. Exhibition Center Group.

Zheng said, “The U.S. dollar is depreciating and the U.S. economy is still the powerhouse of the world.”