Of MICE and plans: Private and public efforts aim to make Lima a centre for meetings

More than 5000 people are expected to fill Lima’s prime hotels in October 2015 for the annual meetings of the World Bank and the IMF. Between ministers of finance and central bank governors from 188 member countries, attendees consist of elite tourists with strong buying power and are expected to give commerce and services a significant boost during their stay. This event is yet another reminder of the need to construct a major convention centre equipped to accommodate large groups of business tourists in one location.

Peru’s greatest challenge to entering the meetings, incentives, conferences and exhibitions (MICE) segment is possibly the most important – lack of sufficient space for large events. However, this has not deterred private initiatives from pushing MICE into view, efforts that appear to be receiving increased attention and solid responses from authorities.

Bureau

Up to February of 2013 Lima’s Convention and Visitors Bureau (Buró de Convenciones y Visitantes Lima, BCVL), which connects events, professional organisers and associations with professionals, infrastructure and services available in Lima, had been at a standstill. Stemming from the National Chamber of Tourism (Cámara Nacional de Turismo, CANATUR) in 2003, the initiative regained momentum after José Luiz da Cunha, a former executive director at the Ministry of Tourism in Brazil – Latin America’s most active MICE country – was appointed to replicate Brazil’s success in Lima.

Da Cunha is not beginning from scratch. In 2011, BCVL hired MICE Consulting, a Latin American-based firm, to perform a study on Lima’s potential in this segment and map out a strategic five-year plan. One of the tactics highlighted by the study is increased collaboration with government authorities. Carlos Canales, president of both CANATUR and the BCVL, told OBG that agreements with Peru’s Export and Tourism Promotion Agency (PromPerú) have already been signed, allowing the bureau to participate in a number of major international convention centre events, such as Uruguay’s FIEXPO, IMEX in Las Vegas and EIBTM in Barcelona, Spain.

Panorama

The International Congress and Convention Association (ICCA) ranked Peru as Latin America’s sixth-most-important country for hosting conferences in 2011, based on a total of 55 association meetings the country held in that year. Brazil led the pack, having held 304 association meetings, followed by Argentina with 186, Mexico with 175, Colombia with 113, and Chile with 87. Figures from Mexico and Colombia display significant leaps from the previous year and these may prove Peru’s biggest competitors in this segment. According to Canales, Peru held 84 events in 2012, 66 of which were recognised by ICCA standards, an increase of 29 over 2011. However, the bureau believes that within the next five years Lima could host a minimum of 260 international events. The ICCA has established 5200 events of possible appeal for Peru and the bureau is aiming to attract 5% of them. Many would be medium-scale events, with minimum participation of around 350 people. According to Da Cunha, the 5200 events represent around 70% of global conventions and meetings. Canales estimated that fulfilling this goal would bring $1bn of extra revenue for Lima, considering tourists who arrive for conventions tend to spend on average much more than regular leisure visitors. Lima has the capacity and required infrastructure to hold these medium-sized events, allowing it to become a possible “hub for meetings”, as Canales described it.

Associates & Events

The first strategic step is to attract corporate associates. The bureau has already received confirmation from corporates such as Coca-Cola, Backus (owned by SABM iller), Telefónica and Scotia Bank. Lima’s leading hotel chains, tour operators and several airlines, including LAN, TACA, American Airlines and Air France-KLM, have also confirmed financial participation and sponsorship in the project, according to Canales, who said affiliate details still require some organisation. “We have already begun serious coordination that will give us a platform on which to produce events,” he added. The bureau is also moving ahead with a calendar of events in order to avoid repeating efforts during busy months. Currently, the bureau is proposing the construction of exhibition grounds. According to Canales, an adequate expo arena should be designed to hold events such as Mistura, the country’s most important annual gastronomy fair, which can attract around 1m people. Other large events include Motoshow, ExpoMina and ExpoConstrucción, all related to growing industrial activities in Peru.

Government Plans

The private sector is no longer alone in its efforts to enter the MICE segment. Indeed, PromPerú is already carrying out its own study to define the basic components of supply and demand, examining the criteria large organisations use to select suitable conference destinations. “We are finding many opportunities but many obstacles as well,” said Roxana Pérez Guevara, former market research coordinator at PromPerú. The main obstacle is hotel capacity, which she said is not up to par even for a group of 1000 people to room at the same establishment.

The study is also gathering information on existing convention centres and universities that often lend their facilities for these sorts of events. The largest meeting venue is the Westin Lima Hotel and Convention Centre, which opened in 2011 and includes a 2000-person capacity auditorium.

Regardless of the project’s preliminary nature, the Ministry of Foreign Trade and Tourism (Ministerio de Comercio Exterior y Turismo del Perú, MINCETUR) has already thrown around ideas for possible sites, the most popular being La Punta, a district on Callao’s thin peninsula extending towards San Lorenzo Island. The project requires investment of $1.2bn, covering 100 ha of land, with exhibition grounds, a port, an aquarium, a museum, hotels, restaurants and, of course, the convention centre. This area was proposed mainly due to its proximity to Jorge Chávez International Airport, Miraflores and the rest of Lima’s financial district.

Jorge Alejandro Ponce, former investment project manager at MINCETUR, told OBG that public funds will be invested into the project and, once a solid product is conceived, it will operate through the mechanism of a public-private partnership model. State investment promotion agency ProInversión will likely be solicited to assist in the concession process. “Entering the MICE segment [for large-scale events] is also a means to differentiate ourselves from other markets and attract convention tourism,” Ponce told OBG. “It is something we need in Lima because it is a city with 8m inhabitants on the coast, which is a plus among Latin America’s capital cities, few of which are on the ocean.”

Arequipa

The second city of Peru established a convention bureau years before Lima. Since 2009 private and public sector work has produced the Cerro Juli Convention Centre, with a main auditorium capacity of 960 people, a second conference hall equipped for 504 guests, and several other installations for work rooms and cocktail lounges. Other facilities include two showgrounds able to host 2432 and 1856 people.