Chinese Mice Analysis

INTRODUCTION

With its booming economy and ever-growing market, China is expected to become the most popular MICE destination worldwide in the future. China possesses the attractive combination of rich cultural heritage, breathtaking landscapes, and one of the world's fastest growing economies. Most renown international hotel chains have set up facilities in the major MICE destinations Beijing, Shanghai, and Guangzhou, as well as in less-known locations, such as Xi'an, Guilin, and even the tropical island Hainan in the south of China. The country has the additional advantage of world-class service at relatively inexpensive rates. As the host of big international events like the Beijing Olympics Games 2008 and the Shanghai World Expo 2010, China is home to a wealth of new opportunities.

BACKGROUND

1. Geographic Location

China is located in eastern Asia. Today it occupies approximately 9.6 million square kilometers (3.7 million square miles), or nearly one quarter of Asia's land, making it almost as large as the whole of Europe.

Economy Conditions

China has the world's fourth largest economy and second largest purchasing power parity. GDP has risen from RMB362.4 billion in 1978, at the start of the market-based reform period, to RMB24,661.9 billion in 2007 (both figures at current prices). China's per capita GDP, though reaching the record high of 1,000 US dollars last year, still ranks around the 100th place in the world till 2007. However, it is predicted that China will quadruple its 2000 GDP to 4 trillion US dollars, with a per capita GDP of 3,000 dollars by the year 2020.

Source: Chinability (2005)

China also plays a major role in international trade. The country is the world's largest consumer of steel and concrete, using, respectively, a third and over a half of the world's supply of each. It is also the world's second largest importer of petroleum. Counting all products, China is the third largest importer and the second largest exporter in the world.

Social and Cultural Backgrounds

The Culture of China is home to one of the world's oldest and most complex civilizations covering a history of over 5,000 years. The nation covers a large geographical region with customs and traditions varying greatly between towns, cities and provinces.

China encompasses harmonious ecological environment, historical and cultural resources and public environmental, and all these factors contribute to form the social and cultural basis for the MICE industry. Most big cities in China have a comprehensive public facilities, a variety of entertainment options, good social order and high-quality citizens and a unique culture, all those reflect the degree of internationalization and civilization of the country.

Development of China's MICE Industry

World Travel & Tourism Council predicts that China's travel and tourism industry will grow around 8.7 percent per annum in the ten years from 2007 to 2016. This means that in 2016, China will be the second largest travel and tourism economy in the world.

With the rise of China's tourism industry, the MICE industry also develops rapidly. The economic globalization appears to be one of the propellants for the development of its MICE industry. China's becoming a "world factory" speeds up the development of MICE industry and relevant service industry. MICE industry has been developing rapidly in the booming coastal areas.

Moreover, international companies accelerate development in Chinese MICE Market. Recently, famous international companies Deutsche Messe AG and Fiera Milano have announced that they have signed a cooperative agreement to develop in the four large emerging MICE markets of China, India, Russia, and Brazil. Of these China will be their prime market. Through this kind of joint ventures, they can bring more mature MICE management systems of developed markets to China.

SWOT ANALYSIS

 Internal Analysis (S/W)

1. Strengths

Published data indicates that Chinese MICE sector is growing by annually 20% and China has held 5,400 exhibitions and conferences of a certain scale in 2007. And in 2007, total area for exhibitions or conferences in China reached 2.4 million square meters, ranking third in the world. In terms of the number of projects, China ranks the second in the world behind the United States. As a new appealing international MICE destination, China has the following strengths:

1.1. Novelty

Traditionally, the business people in west Europe hold the conferences in Paris, London, Dublin and other European cities. The rotation takes place as well, but actually always inside this small circle. Comparing to these old places, China is a totally new destination for western Europeans. There are different culture, different scenery, and different environment. A new place is good for people to think in a different way and come up with creative ideas. Moreover, China is now drawing the world's interests for its attracting culture, various kinds of beautiful sightseeing places.

1.2 Low cost

The country has the additional advantage of world-class service at relatively inexpensive rates.

Table 1 Global Price Index for June 2006

unit: $

Bus/ subway fare 1 cup of regular coffee Moderate, 3-star hotel room for two persons Moderate, 3-course dinner for 1 person, without alcohol or tip

Shanghai China 0.50-1.00 1.50 40-50 12.00-20.00

Berlin Germany 1.52-3.31 1.90 85 22.91-34.37

Lyon France 1.90 1.90 95.50-191.03 31.83-44.57

London England 1.50-5.58 3.72 170 31.63-40.94

Source: http://www.frommers.com

1.3 Various choices

The territory of the PRC contains a large variety of landscapes. Besides some major MICE destinations Beijing, Shanghai, and Guangzhou, more less-known locations, such as Xi'an,