Expo hubs lose millions as key events cancelled

Kenya’s exhibition industry is grappling with almost zero revenues as a result of economic fallout from the coronavirus pandemic.

Centres that usually host major national, regional and international events have been thrust into a rough economic terrain. Facilities such as the Kenya International Convention Centre (KICC) and Sarit Centre in Nairobi have been left counting losses since March when the first case of Covid-19 was reported in Kenya.

KICC has seen cancellations of about 10 events scheduled for between March and June period attributed to the lockdown and travel restrictions put in place to curb the spread of the pandemic.

The centre is tasked with positioning the country as a favourable destination for meetings and events in the sectors of associations, governments, incentive travel and exhibitions.

Africa’s leading science and technology event, Next Einstein Forum 2020 Global Gathering, which was scheduled for March 10-13 was cancelled on the last minute following a government directive banning mass gathering.

Other events that have failed to take place include China Province Expo, Nation Media Group Reality Show Expo and Conference, Professional Packaging Expo (PROPAK) and Build Expo. There were also Auto Expo, Oil and Gas Expo and China Trade Week scheduled for May and June.

“Since the onset of the pandemic, hundreds of events have been cancelled all over the world, and waking up to the news of cancellations or postponements become the new normal,” KICC chief executive Nana Gegaca said in a note to MarketPlace.

This has worsened the financial woes for KICC that has been under pressure to pay debt of about Sh211 million owed to suppliers and contractors from past years.

“The year 2020 has quickly gone from a promising year for the events industry into one of the most damaging, and the estimated recovery period remains uncertain,”Ms Gegaca added.

Sarit Expo Centre, another favourite spot for events, is also counting losses amounting to over Sh70 million in revenues over the past few months.

Sarit chief executive Jason Zeelie said the centre has not conducted business since March when the first case of Covid-19 was reported in the country.

More than 90 events have been postponed including Sarit’s own event, Getaway and Holidays, Home and Garden, Dadasphere and Total Kenyan Motoring Show to a later date depending on the evolution of the virus. Others include East Africa Auto Parts and Trace Music East Africa Concert postponed to next year.

The centre that runs three halls and four meeting rooms has been staring at empty space with Mr Zeelie saying the effects on targeted clients including vendors, sponsors, exhibitors who use the centre for marketing are immense.

Since its launch in September 2019, Sarit has been targeting business events like corporate meetings, product launches, tech and non-tech conferences, seminars and association meets for income. Exhibitions and trade fairs have accounted for 70 percent of its events.

“The company went from generating millions of shillings in revenue to nearly zero in just weeks because of lockdowns. The pandemic has completely shattered a huge sector of the events industry and our business is trying to survive,” Mr Zeelie said.

“With travel bans and restrictions meetings, we found ourselves unable to operate with the perception that the events industry only serves festivals and weddings being incorrect.”

The centre had employed 20 people directly and another 20 on contracts. However the crisis has seen six employees sent home and remaining put on a salary cut.

The business has also been working with stakeholders in the events industry such as event planners, caterers, AV suppliers among others.

The company has now been forced to turn to video conferencing software such as Zoom and MS Teams.

“In as much as these technologies were around before the pandemic, and while they offer an alternative, they do not provide the same level of engagement as physical events,” Mr Zeelie said.

“We are desperate for the end of this crisis, or at least some glimpse of the tunnel’s end. As a purpose-built convention centre, we have invested a lot of time and effort as we wait or the government to fully re-open the sector.”

Going forward, many events are expected to incorporate some sort of virtual component, allowing those who cannot attend to join.

“People are still sceptical about attending conferences with the virus recovery timeline still not promising. However, the events industry cannot remain frozen. Events and meetings will recover, but it will not be quite the same.”

The industry, he said, is looking forward to a stimulus package from the government to businesses that have been massively impacted by the pandemic.

“It is important to note that Meetings, Incentive travel, Conferences and Exhibitions (MICE) are all crucial in supporting other industries. When the country emerges from this crisis, it is clear that all industry sectors will need to rebuild their confidence,” Mr Zeelie said

“Events will be a major facilitator of this and are a critical component in the rebuilding of both regional and national economies. We, therefore, cannot dare lose this expertise and capacity.”

US- based Events Industry Council and Oxford Economics have reported that the meetings industry contributed $1.07 trillion to the global economy through direct spending in 2017 and supported 10.3 million direct jobs.

In Africa the sector was valued at $23.4 billion in direct spending accounting for 80.6 million participants and 328,000 direct jobs.

Sarit Expo Centre has previously been in collaborations with companies and events from Europe, Africa, China, Korea, Embassies and local companies.