HKCEC and ZZICECOne Country, Two Systems!

AIPC Annual Conference 2008 Singapore, June 28 - July 2

Global Expansion of Exhibition SpaceBetween 2000 and 2005

Europe: +30%

Asia: +86%North America: +45%

Global Expansion of Exhibition SpaceBetween 2006 and 2010

Europe: +13%

Asia: +20%

North America: +8%

Oceania: +6%

Middle East: +38%

Asian Exhibition CentresNo. of Centres Sqm

China 84 3,503,789

Japan 12 350,606

India 12 257,457

Thailand 6 205,025

Singapore 3 162,600

Korea 10 166,556

Hong Kong 3 132,520

Australia 7 111,242

Taiwan 4 105,409

Macau 2 76,715

Malaysia 3 58,954

Pakistan 2 39,045

Vietnam 4 33,793

Indonesia 3 31,656

Philippines 1 8,300

Total 156 5,243,667

Source: Business Strategies Group – June 2008

Trade Fair Industry Trends - Asia

• Grew 18% in 2007 (in sqm sold)

• China is the largest market (21% growth)

• India is fastest growing market

• South Korea is next fastest growing market

Source: Business Strategies Group – June 2008

HENAN PROVINCE & ZHENGZHOU

Demographics

Hong Kong Zhengzhou

Population 7.1 million 2.1 million(7.1 in prefecture)

Size 415 sq. miles 2,875 sq. miles

GDP (2006) US$190.4 billion US$29.1 billion

Province GDP (’06) NA $180.6 billion(Pop: 100 million +)

GDP Chg (2007) +8.4 % +14.5

Venue Capacity Comparison

HKCEC ZZICEC

GFA 2.7 million sq. ft. 2.4 million sq. ft.

Exhibition (External space)

681,000 sq. ft.(N.A.)

710,000 sq. ft.(409,000 sq. ft.)

Meeting 225,000 sq. ft 83,433 sq. ft.

Entertainment 141,000 sq. ft.(GH, H3, T1 &T2)

66,500 sq. ft.(GH, IT, T1, T2)

Hong Kong

• 2 convention and exhibition centre (w/arenas)• 2 smaller expo centres• 1 stadium• 1 coliseum• 4 cultural centre complexes• 27 community centres, museums, recreational

centres, smaller university venues, etc.

Management Structure

HKCEC ZZICEC

Term 40/20 years 15 years

Funding Private/Public Public

Op Funding Private Public

Mgmt Fee None Guarantee

Remarks Real estate taxes, commissions, capex

Taxes, perks, service fees

Event Activity

HKCEC ZZICEC

Exhibitions 105 23

Conferences 43 26

Banquets 299 4

Entertainment 70 11

Other 824 9

Annual Results

HKCEC ZZICEC

Total Events 1,341 63

Attendance 4.9 Million 1 million +

Total Revenue

Rev Distribution * 49/11/37/3 85/10/5

Operating Profit Yes Yes

* Rental/Equipment charges/F&B/Other

Personnel Data

HKCEC ZZICEC

Normal Work Week 54 hours 40 hours

Overtime Compensation Comp Time or OT at Regular Hourly Rate

Comp Time

Senior Mgmt Average Annual Pay

All Other Staff Average Annual Pay

Bonus 2 months pay 2 months pay

Mainland China

• Impacting the venue industry also are the 2008 Olympic Games in Beijing and the 2010 World Expo in Shanghai

• China needs “co-ordination scheme” to prevent over supply of venues (3 “national level” cities plus 10 “regional cities”)

• Shortage of talent, especially at managerial level; more universities addressing this

Mainland China

• Strengthen the infrastructure related to venues

• Bring the market mechanism into full play

• Optimize external environment for each industry and crack down on the protection of Intellectual Property Rights

• Speed up professional personnel trainingMinistry of Commerce

Challenges ahead: