HONG KONG -- The organizers of the Cosmoprof Asia trade show in Hong Kong did their best last week to disprove the saying that beauty is only skin deep.
On the streets, it was the ugliest week since anti-government protests began in June. An unarmed demonstrator was shot in the chest at point-blank range by police. Protesters were blamed for the death of an older man hit by a brick during a clash with opponents and for setting another man on fire. Demonstrators cut off train lines, traffic tunnels and highways while police fired tear gas at daily lunchtime protesters in the Central business district.
But inside the annual beauty products show, among Hong Kong's largest, the talk was all of cosmetics, skin care, perfume, spa treatments and manicure tools.
"I have come to the fair as a visitor every year since 15 years ago. I am not quite worried about my safety," shrugged Indonesian hair product seller Soesanto Tiang as he strolled the exhibition aisles. "We have similar issues and situations in Indonesia, so I will be safe as long as I avoid being in chaotic protest areas."
With many foreign governments warning against the risks of travel to Hong Kong, overall visitor numbers have plunged, putting into question a conventions and exhibitions business that last year drew 2 million overseas visitors who spent much more than the typical tourist.
Dozens of concerts, sporting events and performances have been called off. Business meetings and conferences have been postponed or moved. The Asia Video Industry Association shifted its annual summit to Singapore, Asia's busiest business event hub. Even a lottery draw last week had to be put off.
Yet organizers of the large-scale exhibitions that are the lifeblood of the Hong Kong Convention and Exhibition Centre have largely stuck to their plans through the city's peak October-November season.
So far just three smaller expos have been canceled at the center since the demonstrations started. Film-industry event CineAsia announced its decision to do so last Thursday "due to the escalation of violence in Hong Kong," following moves by Seafood Expo Asia and the government's own Mainland Higher Education Expo.
"We have opened every day for business," said Monica Lee-Mueller, HKCEC managing director, noting that shows had continued even at times the subway and nearby shopping malls shut down. "We are working, operating as normal."
Through next year, the calendar for the HKCEC, which hosted the majority of Hong Kong's 138 exhibitions last year and is midway through a $128 million refurbishment, remains close to full.
"We have had different challenges throughout the years," said Lee-Mueller, who helped navigate the Asian financial crisis, the SARS outbreak and the global financial crisis in her 25 years in the center's management. "It is just a different time, a different challenge."
Indeed, business struggles on in the city despite the unrest. This month, the Hong Kong Stock Exchange will see Chinese e-commerce company Alibaba Group Holding list up to $13.4 billion worth of stock in an offering set to be the world's largest this year after Saudi Aramco's.
Exhibitor and attendance numbers have proved relatively resilient. While the city's overall visitor traffic fell by a third in September, overall overseas exhibitor numbers for seven big autumn expos put on by the official Hong Kong Trade and Development Council actually edged up slightly to about 7,300. The number of buyers coming from mainland China or abroad slid by around 23%, to around 95,000.
"Despite the internal and external challenges that Hong Kong has been facing, all seven HKTDC fairs and associated events ran without a hitch," said Benjamin Chau, deputy executive director of the council.
Attendance was a problem also at Cosmoprof where some exhibitors did not show up to occupy booths they had booked. Maunik Shah, a marketing manager with an Indian producer of nail polish packaging, came to exhibit at the show section held at the AsiaWorld-Expo center near Hong Kong International Airport before visiting the HKCEC's portion downtown.
"I think there was an 80% drop in people coming to the fair," he said. "Usually there is no place to walk."
Michael Duck, executive vice president for Asia for Cosmoprof co-organizer Informa Markets, said, "The social unrest in Hong Kong does have some impact on our trade shows."
"We have seen numbers of show visitors drop and some exhibitors have canceled their trips," he added. "However, the overall impact on the exhibition industry to date [has been] thankfully minimal."
One reason why the expos continue is that Hong Kong has several structural advantages over its nearby rivals.
The 24.4 billion yuan ($3.4 billion) Shenzhen World Exhibition and Convention Center, billed as the world's largest exhibition center, opened its doors in the neighboring mainland city in early November. But such mainland rivals are held back competing for international events by the complications of bringing people, goods and money across borders, as access is more tightly restricted.
Notably, while Shenzhen World is being managed by American venue operator SMG, it has so far attracted only domestic events, including a number previously held in Guangzhou.
Monica Lee-Mueller of the Hong Kong Convention and Exhibition Centre says the protests are not the first time the industry has been tested. "It's just a different time, a different challenge." (Photo by Takeshi Kihara)
Macao is also pitching hard for Asia's meetings, incentives, conferences and exhibitions business, known as MICE to keep weekday traffic flowing at its mammoth casino resorts.
Sheldon Adelson, chairman and chief executive of casino operator Las Vegas Sands, on Oct. 23 reiterated to analysts his belief that "Macao has the potential to become the MICE capital of Asia."
By its own count, Sands now controls 80% of the MICE space in Macao, concentrated in its flagship Venetian Macao resort, and its events drew 990,000 visitors to Macao last year, with almost two-thirds coming specifically for exhibitions and trade shows.
At the same time, rival Galaxy Entertainment Group recently started promoting to event organizers the 40,000 sq. meter convention center it is building at its casino resort next to the Venetian as part of a HK$45 billion expansion plan.
Nevertheless, in the view of Informa's Duck, the new centers in Shenzhen and Macao, as well as ones underway in Guangzhou and Zhuhai, will have a hard time tempting away exhibition organizers from Hong Kong even with offers of discounted or free space -- unless the protest violence gets even worse.
"When you have a successful exhibition in Hong Kong, to move it from Hong Kong exposes yourself to someone taking your slot," he said. "It is by far the best place for regional shows in Asia."
When Informa previously held expos in Macao, Duck received complaints from exhibitors who felt casino tables waylaid show visitors. Indeed, two smaller annual expos that started in Macao later moved to Hong Kong.
"Hong Kong is by far the best place for regional shows in Asia," Duck said. "What I fear, though, is that as the protests escalate, serious damage to Hong Kong's image may be done. It is a great shame for those of us who have put our hearts and souls into this industry for decades to see it possibly irreparably damaged."
Lee-Mueller has her fingers crossed. "We hope this social movement will be resolved soon," she said.
Additional reporting by Olivia Tam.
