Commentary: A Turkey in Dubai

While a large part of the North American meetings industry went silent last week as attention turned to turkey, trimmings, and a weekend of shopping, events half a world away showed how quickly a new, unexpected threat to meetings or destinations can burst onto the scene.

This one emerged in one of the newest outposts of the global meetings industry, Dubai. On Thursday, Dubai World, a mammoth investment company with a major stake in the state’s tourism boom, sought to delay payments on nearly $60 billion in debt. The news has sent shivers through worldwide financial markets.

Dubai “is weighed down by massive overinvestment in glitzy real-estate projects, and the bill is just beginning to come due,” The Washington Post explained. “The government has invested heavily in a jaw-dropping array of hotels, resorts, and office towers that make Las Vegas seem quaint by comparison. Among the attractions: An indoor ski slope and a man-made island shaped like a palm tree.” As Dubai began to heat up, the meetings industry jumped on board, with analysts anticipating that it would become a major center for meetings in the Middle East.

But eventually reality began to bite. Debt piled up, jobs evaporated, and then came last week’s announcement, and the global economy felt the shock wave.

While the crisis may pass as Dubai World works to restructure its debt, there are two takeaways from Dubai’s woes. The first is that shiny new things can fall apart very quickly. The second is that when they do, the people most affected may not see it coming. Meetings destinations are vulnerable to large forces sitting just below the surface, and in this case, the meetings-industry repercussions may spread well beyond the emirate. Dubai World is heavily invested in, among other properties, the $8.5 billion CityCenter complex that begins to open today on the Las Vegas Strip; Mandarin Oriental, New York; and Fontainebleau Miami Beach. The Wall Street Journal also reports that Dubai World owns Nakheel Hotels, which includes the new W Hotel in Washington, D.C., and the Turnberry golf resort in Scotland.

Few meeting professionals have the time or information access to track broad economic or investment trends. Fewer still see that kind of broad environmental scanning as a job responsibility, much less a survival skill. That means we risk being misled by the kind of happy talk that touted Dubai as the next big thing.

And now, we’re hearing that the U.S. hospitality sector is sure to recover by mid-2010. Is anyone placing bets?

Mitchell Beer, CMM, is president and CEO of The Conference Publishers Inc., one of the world’s leading specialists in capturing and repurposing conference content. Beer blogs at http://theconferencepublishers.com/blog. Send comments, facts, arguments, or column ideas to mitchell@theconferencepublishers.com.

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