Though the exhibition sector is a driving force for sectorial transformation, the policy makers and higher government officials give not due concern with the economic impact of the industry, so disclosed experts. Nebeyu Lemma is an event person engaged in the transformation of sectors through organizing valuable trade and knowledge platforms. He is a founder and managing director of Prana Events. And he is a cofounder Nitad Trading & Service PLC and Lunar International College.
As to him, the exhibition sector is a driving force for sectorial transformation, which needs attention and support as it has a direct, indirect, and induced impact on the economy. It is know that the government is striving to make the country a light manufacturing hub in the continent by 2025. For the manufacturing sector to flourish, the country needs technology, inputs, solution, and knowhow from the developed world.
There is no alternative way to find all this apart from the exhibitions that gather global leaders and local players in one place with their products, technology and senior experts. We have many competitive advantages to make Addis Ababa a hub for international exhibitions and conventions organized in Africa as Dubai has turned a hub for the gulf region. There is a need only for a proper policy and enough attention from the government to make the industry generate Billions of Dollars for the Economy in a short period.
I recommend the government to invest in International standard Exhibition Venues as soon as possible and make exhibition venues to be free zones to avoid the customs issue. Regarding the challenges besetting the exhibition industry from turning successful, he indicated that the first is a lack of understanding by policymakers and higher government officials when it comes to the economic impacts of the industry.
The other main challenge is the lack of an international standard venue for large scale exhibitions. From June to October, three international exhibitions were canceled or postponed due to government officials’ order to use the site as the only large hall the country has is the Millennium Hall.
It is the only and one hall the country uses for everything. As per my information, Ethiopia is the only country that canceled an exhibition after it was started. This could tarnish the country’s image in the global arena. Adding he said that there is also lack of industry coordination. There is no clear information as to who is leading the sector. Even the management’s license is under the Ministry of Tourism, which never supported the Sector.
The Exhibition Permit is given by Export Promotion Directorate General under the Ministry of Trade and Industry for international organizers. In contrast, the City or Regional Trade and Industry Bureaus is supposed to give the exhibition permit for local organizers. The exhibition permit from the Addis Ababa Trade and Industry Bureau has been disrupted for four years now by the then Deputy Bureau head without updating or revoking the directive. This is against the guideline set by the Ministry. Export Promotion Directorate people are seen doing things out of their mandate. Now, no government office has compiled information about exhibitions organized in Addis. He capitalized that lack of industry policy and strategy is the other big challenge.
There is not a clear policy set for the Industry apart from the trade-fair directive, which lacks to address critical issues. Even though the Export Promotion Directorate General has prepared a revised draft, the responsible Ministers couldn’t get it approved for over five years. During the last few years, foreign organizers are entering the market against the law, which affects local organizers’ success. Now, anyone can organize any show at any time, which is killing the Industry. “Most of the sectors are small to afford multiple shows in one market.
There should be a policy that only allows one strong exhibition in one sector if we need to effect change in that specific sector. This policy would benefit the regional capitals to host various sectorial exhibitions. Now, Addis Ababa is hosting all specialized exhibitions in the country. The experience of countries that built a strong exhibition industry is one show in a specific sector in one region,” he pointed out. He stated that discouraging Customs law is the other challenge.
Exhibitions are mainly about exhibits. We need to bring more technological products and know-how from the developed world. Foreign companies that exhibit in our shows want to bring their products for live demonstrations. The law has obliged them to return the exhibits after the show, and they should deposit the tax amount for the sample product they send. Here is the problem, as the tax amount is enormous; they are not willing to bring their machineries.
As to him, even if they are eager to bring their items, they are obliged to deposit the tax amount in local currency, which they can get back after the shipment is returned. However, they will get back the deposited tax amount in local currency. What will they do with the Birr with the existing foreign currency policy? Due to this, they decline to participate, or they only take a small 3×3 stand to promote their company through promotional materials even though they are interested in renting bigger space to fit for their machinery and mobilize their technical team for installation and demonstration.
This customs law is forcing the country to lose foreign currency earnings from space rental, stand construction, flight, accommodation, city tour, local spending of delegates, and other local services. According to him, tax policy is also the other challenge. In many countries, foreign companies are exempted from paying VAT.
“However, we are obliged to collect the VAT from international participants, which makes the participation cost higher for them as compared to other countries. Thus, companies prefer to go to other countries with cheaper participation costs.
Lack of incentive for the sector is also one of the challenges. As I mentioned above, the Sector is under the Ministry of Culture and Tourism. Tour operators mobilize leisure tourists, and we bring business Tourists. Most of the Hotels in Addis Ababa serve business tourists that come for exhibitions, conferences, or different business activities. While the MICE industry is the main factor to attract foreigners and foreign currency to the country, it doesn’t have any incentives to import the required event equipment and technology. In contrast, the tour operators and hotels have DutyFree privileges. Trained human resource, Logistics, visa issue for some countries, lack of suppliers for event services, etc. are also some of the challenges.
The Ethiopian Herald April 12/2020
BY MEHARI BEYENE
