The conflict in the Middle East is beginning to impact the MICE sector.
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Ongoing operations and groups in the air
Don’t panic: in the short term, the impact is limited. However, the situation is evolving almost on a daily basis and many operational decisions depend on how the conflict progresses.
According to Iñaki Collado, president of the Idemice association of incentive agencies, some operations planned in the region had to be cancelled or adapted. Groups in Oman, for example, were able to return without incident, but planned operations in the Emirates were eventually cancelled.
Beyond the destination itself, the problem is not always in the country where the event is held, but in the way to get there. The closure or restriction of some airspace is complicating international itineraries, especially those that depend on the major Gulf hubs, which today concentrate considerable traffic.
Emirates, Qatar Airways or Etihad airlines are common connections to Asia from Europe. When these routes are affected, many itineraries are no longer viable. According to Collado, operations to destinations such as Thailand are being directly impacted because the scheduled flight with a stopover in Dubai, Abu Dhabi or Doha can no longer be operated.
Moreover, the situation at Dubai airport reflects this volatility well. After a total shutdown over the weekend, traffic has partially resumed, albeit with the risk of further cancellations or disruptions complicating planning.
This uncertainty makes it necessary to reorganize trips at very short notice or, in some cases, to cancel them outright.
Spain as an alternative destination
In parallel, a movement is beginning to appear that the industry is already well aware of. When certain regions become unstable, organizers look for destinations that are perceived as safe and well-connected. And Spain is often on that list.
Fay Taylor, president of Spain DMCs, confirms cases of events that have been redirected to the country. For the moment they are few, but the movement exists.
Tengo dos asociados que me han contestado que sí, que han recibido grupos que se han cambiado de destino y que vienen a España”, explica.
The phenomenon is still in its infancy because many events are planned months or years in advance. In addition, the ability to change a destination is highly date-dependent. Canceling an event planned a few weeks from now is easier than rearranging an event planned for the fall.
Limited capacity to absorb more events
These diversions to Spain seem positive… but there is no infinite capacity to absorb them either. The country is under heavy tourist pressure and many cities are close to their limit in high season.
José Luis Vázquez (IAG7) recalls that destinations such as Barcelona, Madrid, Valencia or Málaga already operate with very high occupancy levels for several months of the year; absorbing additional large events is not always possible.
Force majeure and contracts in the spotlight
The crisis brings back to the table an issue that the industry has been familiar with since the pandemic: the interpretation of force majeure.
In theory, the legislation contemplates this figure for extraordinary situations that prevent the provision of a service. In practice, it all depends on the moment, the contract signed and the supplier involved.
Fay Taylor reminds us that the force majeure argument has limits.
“Cancelar convenciones de octubre ahora mismo no es fuerza mayor porque no sabemos qué va a pasar en octubre”, explica.
There is no clear definition of the time horizon in which this figure can be invoked. In practice, many hotels handle these situations on a case-by-case basis, depending on the client, the time of cancellation and a key factor: whether the event is already paid for or not. If it is not, it is more difficult to demand payment in a context of uncertainty.
In addition, each supplier may interpret the clauses differently. Collado explains that agencies are often caught between European regulations and the terms and conditions of the international suppliers they work with. Even when the circumstances are clearly extraordinary, refunds or free cancellation are not always provided.
This asymmetry generates frequent tensions in the sector’s operations. In practice, the agencies end up acting as intermediaries that absorb a large part of the pressure and economic risk.
The sector also pays a frequent informality: in many cases the trust between agency and client leads to not signing a contract that clarifies the cancellation conditions… while the agency does have contractual commitments with hotels, airlines or other suppliers, generating an imbalance.
If there is no clear contract with the client, Collado explains, package travel regulations may come into play. This means that, for example, if a flight is cancelled, the agency could be obliged to assume certain additional costs, such as accommodation or meals, if the traveler is stranded at the destination.
However, Collado reminds us that many MICE operations take place in a strictly business context and should not be treated as conventional tourist trips.
“Las agencias de incentivo trabajamos en relaciones B2B entre empresas, organizando experiencias corporativas complejas. Por eso es importante recordar que el propio artículo 150 de la Ley General para la Defensa de los Consumidores contempla excepciones cuando se trata de operaciones organizadas en el marco de una relación profesional”, explica.
In his opinion, the challenge for the sector is to strengthen legal certainty and better clarify these contractual frameworks, preventing a strategic business activity from ending up subject to regulations designed for vacation tourism.
A market that was already tense
Beyond one-off cancellations, many professionals believe that the real impact will come if the conflict is prolonged.
José Luis Vázquez, of IAG7, warns that the sector was already operating with a shrinking map of destinations before this crisis.
“Ya teníamos pocos destinos a donde ir. Muchos eventos van a, o pasan por, Oriente Medio y ahora eso se complica”, señala.
In addition, some markets were already losing attractiveness for political or regulatory reasons, increasing the pressure on alternative destinations.
Wait and see
Rather than massive cancellations – with the exception of imminent groups or those already at their destination – what is perceived in the sector is a pause in decisions.
One hotel chain explains that it usually receives about 200 requests a day, a figure that fell by more than 35% last week. For many professionals, this is a clear sign that clients prefer to wait and see how the situation evolves before confirming new projects.
This same pattern is also beginning to be observed in DMCs, where several companies report a decrease in requests for proposals for future events. In times of great uncertainty, companies prefer to postpone decisions before committing budgets for corporate events.
The effects, therefore, could be more visible in the medium and long term than immediately.
The real risk: inflation and oil
If the war is prolonged, the impact could come from the other side. Not so much because of the insecurity of travel, but because of the economic consequences.
The price of fuel is one of the first indicators. If the conflict drives up oil prices in the long term, transportation costs will eventually rise.
Collado sums it up neatly. “
The problem lies more in expected inflation and rising prices than in destination insecurity,” he says.
This is compounded by the general rise in the cost of logistics and business production. If costs rise significantly, many companies may cut event, incentive or convention budgets.
Vázquez puts it bluntly: if the war drags on, the real risk is that “companies will have no way to maintain their conventions or their expenses”.
At the same time, some transportation companies are already warning of possible tariff revisions. If the price of fuel does not stabilize, they may be forced to modify rates already confirmed for groups expected in the short term.
A sector accustomed to reacting
For the time being, the sector is watching the evolution of the conflict with caution. One week is too short a time to measure structural impacts.
Recent experience shows that tourism and events are highly resilient. Destinations that experience crises tend to regain confidence relatively quickly once the situation stabilizes.
The question is how long the uncertainty will last this time. In the events business, where many decisions are made years in advance, that uncertainty weighs as much as any bombshell.
