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Kennedy believes the professionalism of the meeting industry will be established in 10 years in the Gulf.

Reed Travel Exhibition Group exhibition director Paul Kennedy MBE talks economics, identity, definition, challenges and markets.

Will the credit crunch have an impact on the meetings industry in the Middle East?

The credit crunch is not having and won't have a uniform impact across all the economies of the world - that's nothing to do with the meetings industry, that's just the macro-economic perspective.

Clearly it's having an impact on Western economies and the Japanese economy that continues to enjoy stagflation. Save for that, the Middle East's economies are largely unaffected and most of the major economies of Asia are also riding it out.

If you translate that to the meetings industry in Asia and the Middle East, it's largely not having an impact on demand for meetings and conferences.

Both areas of the world are enjoying very substantial growth in demand and that is leading to premium prices being charged for space.

In terms of destination marketing, which is where shows come in, there is no discernible sign of a slow down in destination marketing spend and I think that's for two reasons.

Primarily the budgets were already secured, but more importantly, increasing numbers of governments are seeing the economic multiplier value of the business of meetings.

There is a much higher spend per delegate when compared with a leisure consumer and destinations are beginning to recognise the need to compete in the global market. This would suggest that destination marketing budgets in the Middle East are incredibly robust.

Do you feel the Middle East meetings market is struggling to identify itself?

We spend substantial resources on discovering who in the GCC is involved in the business of meetings, because we know most people aren't called a meeting planner or head of conferences - they are called almost anything but.

However, the problem of definition and professional identification in the meetings industry is not uncommon. It was the case even in the mature markets 20, 30 or 40 years ago - there weren't people called meetings planner then.

But the recognition of the role of someone who creates meetings for their organisation is becoming established as a key function in many organisations.

The fact that there are accepted techniques and methodologies to record the return on investment of a single meeting (in terms of corporate strategy and organisational output), means that the value of meetings is an integral part of an organisation's life and that is now becoming widely accepted.

At the national macro-economic level, the economic multiplier of meetings, both domestically and inbound, is being recognised as quite an important economic activity in its own right.

And the fact that we are seeing the big international associations such as MPI, SITE and ICCA beginning to put a toe hold in the Middle East is proof that people are getting the economic value of the meetings industry.

Do you think the Middle East meetings industry will take 40 years to define itself?

I don't think so. The emergence of the industry here will probably parallel the emergence of every other sector - it will be an almost vertical learning curve.

I think we will see the profession established in the Gulf in a decade and that will only be manifest when the region is earning its fair share of association business, which brings some fairly major challenges for this region because of current high costs.

That's why when the hotel stock comes on stream it will make a more appropriate supply and demand situation and therefore price will not be so much of an issue.

That needs to happen to secure the large associations.

What are some of the major challenges facing the Middle East's meetings industry?

The first question is where to find enough people. There was a hotel in the Far East that opened with 10,000 positions not filled in a venue that needed 16,000 to service it - you are talking about a continent with the largest population in the world.

One of the other challenges you have in the Middle East is that rent is incredibly high. If you have very high rents and fairly strong inflationary pressures it leads to wage inflation and that leads to higher prices so you have a vicious economic cycle.

Eventually, the ability to own property as an ex-pat will become an issue.

The long-term human capital requirements mean people will have to put down roots here.

Where will the demand for the Middle East meetings industry product come from?

If you go around the Middle East you know where the tourists have come from because initially the Middle East has looked west.

The Middle East will look east because that's where the huge demand in the future will come.

Just look at the population base of Asia. It's six times that of the whole of the Western economies, excluding Africa and South America.

The largest incentive groups in the world come out of China dwarfing everything else. Eventually Middle East destinations will be able to bid for that sort of business.

I know some of the tourist authorities here have a pretty good understanding of how to serve the Western visitor, but the challenges of the Eastern visitor will be just as major.

It's very different because the cultural dietary habits are dramatically different and you have to understand how to service those needs.

That is another challenge for the Middle East, but a challenge, no doubt, it will rise to like it seems to rise and tackle everything else.

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