The mainland's status as an event destination is rising, with expectations that the nation will be the world's No1 tourism destination by 2020. On the back of this growth will be the Mice industry - and two big events this year will highlight both the sector's potential and the challenges it faces. For the next six months, all eyes will be on the World Expo 2010 in Shanghai, while Guangzhou has a chance to shine in November when it hosts the Asian Games. The mainland holds 11th place in the International Congress and Convention Association world rankings and is expected to be in the top three when it comes to being a favoured destination among multinational corporations and major event planners. The World Travel and Tourism Council, which holds its annual summit in Beijing in May, predicts that the mainland will have the second-largest travel and tourism economy in the world by 2016. And the recent Incentive Travel and Conventions, Meetings China 2010 fair was told that the mainland's annual tourism growth will surpass 10 per cent over the next decade. International hotel brands are investing in provincial cities. More foreign companies are also looking to the mainland to host corporate events and are attracted by high-quality service at relatively inexpensive rates. There is no doubt about capacity, given the 87 exhibition centres that provide a gross indoor area of 3,861,593 square metres. Hong Kong's three centres offer 151,920 square metres. Sustaining this potential is a challenge that has to be met by training and co-ordinating the sector's growth, industry observers say. Charles Lai, vice-president of sales and marketing for Greater China at Millennium Hotels and Resorts, says the industry still needs to improve, particularly to cope with an economic slump or tough competition over the next year. 'From a macroeconomic perspective, 2010 will be a very competitive year for the hotel industry in the Mice market,' Lai says. 'The overall demand is still strong but growth will slow down with a significant decrease in consumption.' For event planners such as Doris Lam, general manager of Hong Kong-based Momentous Asia Travel & Events, the mainland has already staked its claim on the international Mice scene. 'They have all the hardware and you can easily find a hotel with meeting facilities that can accommodate up to 1,000 people in most major cities,' she says. 'The mainland has been catching up very fast, both in terms of Mice facilities and as a source market. There are many multinational companies throwing big parties and events. I'm sure Mice suppliers in China will learn very fast.' Tracey Edwards, general manager of CiEvents, believes concerns such as training will be addressed by the market. 'China continues to engage in exciting meetings, training and events as global businesses instil their standards. We have found this to be especially the case for the pharmaceutical industry. This will ensure that staff are being effectively trained,' she says. Others believe the World Expo will leave a legacy. When it's over, it will be business as usual as the mainland already has a vibrant domestic exhibitions industry which continues to grow with the economy. Paul Woodward, chairman of Business Strategies Group, a trade fair and business events consultancy, says: 'Domestic activity will become increasingly important. Chinese companies doing business with each other and with the Chinese subsidiaries of major multinationals will be the big trend. 'International activity in China will be the cream on the cake, as it is to some extent in the United States market. The World Expo is a very different type of event. It's primarily a showcase of the world to the Chinese people, so it doesn't really compete with commercial exhibitions. 'In practical terms, what it does mean for Shanghai is that there will be a legacy of new permanent facilities, including the convention centre. 'There will also be about 40,000 square metres of permanent exhibition space on the site. There will also be a legacy of an enhanced reputation that says that Shanghai is capable of organising very large world-class events.' The benefits in terms of venue booking fees and deals on hotel meeting packages brought on by the surge of Mice business are filtering through. Yates Fei, a director with corporate travel specialist Hogg Robinson Group, feels this will be the case with Beijing, particularly when the expo is in full swing. 'The city bears the consequence of an unexpected room surplus experienced during the Olympics period. While high-end hotels work hard to fill up the rooms, they face competition from budget and low-end accommodation because corporate travellers are still seeking out cost-saving measures,' Fei says, adding that many exhibition and convention venues are offering a lower corporate rental rate of about 40 per cent. In preparation for the 16-day Asian Games in November, Guangzhou has undergone its first huge infrastructure makeover, which will boost its Mice status. Sunny Paw, vice-president and general manager at Shangri-La Hotel Guangzhou, expects demand for rooms to increase by more than 20,000 during the event. The Canton Trade Fairs have traditionally been the staple of Guangzhou, but the city has more to offer the Mice industry. 'Guangzhou Mice is developing beyond the Canton Fairs,' Paw says. 'It is estimated that more than 350 exhibitions and 1,100 trade fairs are held in Guangzhou each year. The direct income of Guangzhou's Mice sector accounts for 41 per cent of that for all of Guangdong province.' An express rail service connecting Hong Kong to the national high-speed network and bridges linking Pearl River Delta ports is expected to further boost the industry. Compared with other key cities, the Mice sector in Shenzhen is fledgling but developing rapidly. The Shenzhen Convention & Exhibition Centre has become the barometer of business events. In the first half of this year, nearly 30 exhibitions have been scheduled. 'We are confident that hotel Mice business will continue to perform well in 2010,' says Christian Buggelsheim, manager of the Crowne Plaza Shenzhen, which saw a 30 per cent increase in inquiries in the first four months of this year. 'China's Mice industry has entered into a rapid development stage, with its business boom being witnessed everywhere.' For now, the world's exhibitors will be showcasing their nations to the Chinese people, but at the same time Shanghai will be representing China in terms of hotel efficiency and event management quality. Will pricier hotels and flights take the shine off Shanghai? 'I think the expo's impact on business travel will not be too big,' says Jonathan Kao, Hong Kong Four Seas Tours' general manager for Greater China business travel. 'The official expectation is that the expo will attract about 70 million visitors from early May until the end of October. Ninety five per cent will be domestic visitors, which means there will be only about 3.5 million international visitors.'