Recovery of conference travel business threatened by war concerns

The number of delegates who visited Malta on conference travel dropped to 57,500 in 2001 from 61,000 in 2000, according to an in-depth survey of Destination Management Companies conducted by the Malta Tourism Authority last year.

Tourism Minister Michael Refalo said the downturn occurred in the fourth quarter of 2001 and was due primarily to the September 11 tragedy, which affected the peak months of conference and incentive travel to Malta.

The objective of the survey, which was presented at an MTA seminar at St James Cavalier yesterday, was to obtain data on the conference and incentive business in 2000 and 2001.

The survey found that revenue from conference and incentive business fell from Lm19.7 million in 2000 to Lm18.4 million in 2001. These figures accounted for seven per cent of total gross earnings from tourism for both 2000 and 2001.

The average budget per delegate for 2001 was Lm319, the survey showed.

In 2001, 62 per cent of business was from meetings and conferences, while the remaining 38 per cent was from incentive trips. The main source markets included France (18 per cent - marking an increase of six per cent), UK, Germany and Italy (13 per cent) and the Netherlands (seven per cent).

The MTA said the conference and incentive niche market was central to the achievement of its strategic plan objectives to increase volume and earnings in shoulder months.

Dr Refalo said feedback from Destination Management Companies (DMCs) showed that Malta was receiving a larger number of inquiries this year, but that confirmations, particularly for February and March, were slow.

As regards long-haul travel (which accounts for some six per cent of total tourist arrivals), Dr Refalo said the sector tended to "dissipate at the slightest hint of trouble and instability".

Malta, like other destinations, was not immune and was receiving cancellations from long-haul source markets, he said.

He said that in the group travel market, signs of cancellations, originating from Europe, were also being registered and Malta's overseas offices and Air Malta were working hard to retain group bookings made many weeks and months in advance.

However, Dr Refalo insisted that the solution did not lie in price reductions as the fear of flying and responsibility for the welfare of group travellers were not overcome by cheaper prices.

Speaking about the impact of war and terrorism on the conference, incentive and meetings sector, Dr Refalo said that even mere talk, or rumours of war, instability, terrorism and health hazards were enough for organisers to withdraw and cancel events.

Judging from the terrorism attacks on foreigners, it was clear that no country was guaranteed to be safe from terrorism, he said.

Referring to British prime minister Tony Blair's warning of a possible terrorist attack in the UK, Dr Refalo said that although necessary, such comments had a dampening effect on a market, which had shown encouraging signs of further growth in 2003.

The UK market to Malta had made a "terrific" post- September 11 recovery and, despite the withdrawal of subsidies to tour operators, was back to pre-September 11 volumes, he said.

More aggressive and innovative marketing, and the promotion of the conference and incentive sector, had delivered similar results at just over half the cost of what was previously spent for the Tour Operator Subsidy Scheme.

The MTA's research confirmed the lucrative and volatile nature of the sector, as well as DMCs' increased penetration of the main European conference and incentive generating markets.

Dr Refalo said Malta's accession to the European Union would further enhance the opportunities for conference and incentive traffic.

"One local DMC is urgently waiting for the result of the referendum as a group, numbering thousands, would only confirm Malta for a 2004 event if it decides to join the EU," he said.

The EU, he said, organised many conferences and meetings, a number of which were held away from Brussels, and Malta would be "a popular and natural choice" for conference and incentive traffic from the EU and the European Parliament.