Airbase warehouse starts a new career

Subic Bay, the Philippines –A former storage medical warehouse converted into a convention and exhibition centre in a mere six months is playing a critical role in helping this former US military base become a major player in the Philippines travel & tourism promotion efforts.

The centre last week played host to more than 350 delegates at MICECon 2010, the Philippines annual caucus of meetings, incentives, conventions and exhibition organisers, and will soon be hosting 6,000 Filipino accountants for their annual convention.

Subic Bay Metropolitan Authority (SBMA) administrator, Armand Arreza, said: “Last year more than 100 events were hosted with 60,000 participants. It is a good start for us. We are not yet a major destination but I believe we can start small and slowly expand.”

Mr Arreza said convention delegates are pouring an estimated 10 to 12 million dollars into the local economy in direct expenditure in hotels, food, shopping and visiting attractions.

The convention centre itself used to be the warehouse of a Taiwan company that made medical equipment and clothes. Initially attracted to invest in Subic Bay as part of the redevelopment plans of the former base, the company went bankrupt in 2007.

According to Mr Arreza, the SBMA had bid a year earlier to host the 2007 Philippines annual advertising congress. Nine months before the event, it had no convention centre and was planning to erect a large makeshift tent in lieu.

As those plans were falling into place, six months before the advertising congress, the Taiwanese company went bust and offered the warehouse for sale. That proved to be a stroke of luck; the warehouse was fixed up well enough to host the congress.

Since then, it has undergone another US$8 million worth of refurbishment, helping to promote the area as a viable MICE destination. The ad congress returned for another convention last year and the SBMA is pitching to bring it back again in 2011.

Already well equipped with an international airport that is attracting significant volumes of low-cost and charter airline traffic, Subic Bay now boasts a hotel capacity of 2,000 rooms with another 1,000 rooms coming up over the next three years. The completion of an expressway has put it within a smooth two-hour driving distance from Manila.

The story of Subic bay continues to evolve, Mr Arreza said: “We were not even on the radar screen but now, top executives of major multinationals are coming here for conventions and planning major investments of their own in warehouses and logistics centres. This former warehouse has paid remarkable dividends.”

Tourism secretary, Joseph Ace Durano, said he hoped the MICECon convention would help the Philippines convention sector gain the focus it needs to start attracting business from around the Asia-Pacific industry.

He said that budgetary constraints had forced the Department of Tourism to resist the temptation to try to do everything and then end up doing nothing.

“We disciplined ourselves and decided to focus our efforts on specific markets, and then develop the products suited to those markets. This focus should provide actionable steps for each and every one of us.”

Indeed, the Philippines tourism industry overall fared well last year, making it one of the few destinations to record a growth in both domestic and international tourism.

According to Tourism undersecretary, Oscar Palabyap, international arrivals to the Philippines rose from 1.09 million in 2008 to 1.12 million in 2009. Domestic visitors rose from 3.37 million to 4.08 million in the same period.

He said the top sources of international visitor arrivals in 2009 were Korea (19.89% of the total), followed by Japan (12.19%), the USA (11.55%), Europe (10.70%) and China (6.93%).

Developing air access from major tourist markets is a key strategy.

In the past year, the Philippines has stimulated charter flights between Shanghai, Hangzhou and Guangzhou direct to Kalibo and Cebu by Shanghai Airlines, China Southern Airlines, Air China and Philippine Airlines. It has also facilitated charters by China Airlines between Taipei and Kaohsiung to Kalibo and Laoag.

New air services agreements have been signed with Oman, Russia, Libya, Bahrain, Qatar, Kuwait, Spain, UK, Singapore, Thailand, Cambodia, Hong Kong and Iran.

The undersecretary said the newly created Tourism Enterprise Zones were also attracting investments.

Roughly US$773 million worth of tourism development projects had been endorsed in 2009, with job projections of 15,567. Of this investment, roughly US$617 million went into the TEZs, US$80.6 million in hotels, US$39.8 million in spas and US$23.4 million in resorts.

He said one significant recent development had been the approval of the Tourism Act. This would clearly delineate the responsibilities of the various government agencies and boost cooperation with the private sector in formulating marketing and development plans.

One of its key provisions would enable better mobilisation of funds in support of tourism programmes. An entire new Office of Tourism Resource Revenue is to be developed within the Department of Tourism to raise funds in addition to the normal government budget, Mr Palabyap said.