1.3 MICE Development in China

It is evident from the above that competition for event tourism in Asia is high; China with its possibly unexpected tourism development in the MICE industry now also challenges other Asian countries, including the Republic of Singapore. Based on its fast tourism development, China has already changed the ‘one branch of the tree is particularly thriving' situation in the Asian tourism market and has become an important tourism destination, and ‘ranks fourth in the number of tourist arrivals in the world' (UNWTO, 2006). Compared with others, China also has its own advantages: richness in tourism resources, a stable policy structure, one of the longest history in the civilised world, the vastness of the land and thus topographical and climatic variety, rapid economic growth, and more capacity in tourism employee recruitment. China maintains stability in government policy and economic direction. ‘China's population of approximately 1.2 billion, its fiftysix distinct nationalities… its territory of 9.6 million square kilometres all contribute to a cultural and natural resource base that provides the country singular [advantages] with enormous potential for tourism development.' (Zhang, Jenkin & Qu, 2003, p. 277). Furthermore, when China is compared with other countries, a long history is also a significant advantage. Zhang, Pine and Lam (2005) argued that a history of over 5,000 years provides China with brilliant cultures comparable to India, Egypt, and other ancient countries.

The Republic of Singapore, when compared to China, is little more than a city-state with a small resource and land base. Other countries like Thailand and Indonesia possess similar cultural backgrounds, but with more threats of external or internal conflicts and some diseases like AIDS. So, although China is currently at a disadvantage, given its size, it seems realistic to assume it still has huge potential to grow in the international MICE market and achieve a significant share of that market.

The development of the MICE industry in China is based on the Chinese tourism boom. In the past decades since the implementation of some opening-up policies and under the influence of fast economic growth, China has been ‘going all out' to make tourism a pillar industry in its national economy. According to AsianInfo.org (2000, p. 1), ‘In 1998, the number of tourists entering China reached 63.48 million, 35 times the figure for 1978 and the foreign exchange income from this industry reached 12.6 billion US dollars, 48 times that of 1978'. Tourism revenue has already become a significant contributor to the national GDP increase and a major tool in regional economic development and regeneration (Ryan & Gu, 2009). According to Research and Markets (2006), the total revenue of China's tourism industry reached 67.3 billion US dollars in 2002, accounting for 5.44% of the GDP. This astonishing development is not a ‘flash in the pan'; it will maintain such growth rates for some time, and by 2015 China achieved the second place in the contribution of travel and tourism economy to GDP among the countries (Ennew, 2005; WTTC, 2017. See Table 1.2 below).

Table 1.2 Rankings of Countries by Contribution of Travel and Tourism Economy to GDP

Source: Ennew. (2005).; WTTC. (2017).

‘Possibly few, if any, countries in the world have experienced as fast a rate of growth in tourism as China.' (Wen & Tisdell, 2001, p. 15) With this, tourism has become a main source of tax revenue and a key industry for economic development, and as UNWTO (2006) estimated, China will be the first nation that will secure the first position as both a tourism generating and tourism receiving country by 2020.

This growth in tourism has benefited from profound changes in Chinese society, which are transforming a traditional society to a modern one and an agricultural society to an industrial one. This huge social change has had an unprecedented impact all over the Chinese mainland and has caused a huge growth in domestic tourism demand from more and more Chinese people. Lew, Yu, Ap and Zhang (2003) also noticed that by 2020 Chinese domestic tourism revenue will reach 2,100 billion RMB, 6.6 to 9.4 times that of 2000. It is well known that China has the largest population in the world with over 1.3 billion people currently, so if the domestic tourism industry can be stimulated enough, the subsequent growth may be well beyond imagination. Although domestic tourism is currently growing vigorously, it still has more potential to grow.

Currently there appears to be an uneven, slow development of domestic tourism compared to that of international tourism. As Zhang et al. (2005) noticed, more detailed statistics are usually available about international tourism when compared to those about domestic tourism. Yet Jafari (1986) said almost all travel through the world is domestic. The potential growth of domestic visitors to experience MICE tourism products is large.Therefore one purpose of this research is to explore the demand of MICE products in the Chinese domestic market by examining resident propensities and perceptions of MICE events and those of attendees.

There are many statistics that show China is fast becoming a popular venue for international MICE groups. In 2012, the total of events held in China increased to 7,333 (CCTV News, 2012). The growth of MICE tourism is obvious according to Xinhua News Agency (2003) and the rate of events being held in China has increased progressively by 20% every year, most of which are domestic in nature. In China, the use of international events is perceived as an effective means of exciting and attracting not only international but also domestic tourists. China is still a developing country and started its reform and opening-up only about 40 years ago; so many people still have but a small chance to travel overseas due to both economic and other reasons. But people want to know more about the outside world and these international events are seen as one way to help add more knowledge of foreign locations and as a means of doing business and meeting people. Additionally, due to China's large population, the potential for domestic MICE tourism is significant.

Although the MICE market in China is thriving and prosperous, competition for the MICE market in different cities that have the capacity to hold events is severe. Many Chinese cities have seen the potential advantages offered by event tourism, such as high consumer spending and subsequent profits. In recent years, many cities have focused on ‘event tourism' and have engaged in ‘branding their event city' according to their regional characteristics and advantages. Xinhua News Agency (2003) noted that, due to the popularity of the event industry, China has been engaged in building exhibition halls, and many event operators and tourism organisations have striven to join international event organisations. Every tourism city that has the capacity wants to share and seize this potential market. The ‘event tourism' competition among Chinese cities has aided China's event industry to progress, which provides both experience and development opportunities such as the 2008 Beijing Olympics, 2010 Shanghai World Expo and 2016 G20 Hangzhou Summit.

Event development is a ‘new shining spot' for the tourism industry combining different industries and socio-economic elements. According to Xinhua News Agency (2003), the coefficient of event development is 1:8: the ‘1' means event industry, and the ‘8' means its impact on transportation, accommodation, food, shopping, entertainment, and travel, etc. This is akin to an event consuming chain and the tourism consuming chain. These link the event and tourism industry into a tight relationship, which means if the event industry grows, so do other components of the tourism industry. To further develop event tourism, the capacity of a city is important, which includes its geography, economy, security, cultural and social attractions, and scenic values. Li (2004) stated that when applying for an international event, both the tourism environment and natural resources are important factors in the choice of an event destination. China is still a developing country, although many cities have developed well, the above factors are still limited in some cities.