Singapore extended its contract to host a Formula One race for five years till 2017, providing a continued boost to the economy from visitor arrivals and tourism receipts.
The agreement to renew the contract was reached yesterday, said S. Iswaran, Singapore’s second trade minister, who oversees the tourism industry. The Singapore Grand Prix has attracted more than 150,000 international visitors over the past four years and generated about S$140 million ($114 million) to S$150 million in tourism revenue annually, with benefits to the economy expected to remain “at least at this level” for the extended period, he said.
“F-1 has been good for Singapore,” Iswaran said as the city stages the night race for the fifth time today. “Negotiations have taken some time because all parties had specific objectives.”
Singapore is seeking to encourage tourists to spend more by offering marquee events such as Formula One and other attractions as a faltering global recovery threatens to curtail growth in visitor arrivals. Tourism spending is expected to increase as much as 8 percent to S$24 billion this year, according to government estimates.
McLaren driver Lewis Hamilton holds pole position for today’s race at the Marina Bay street circuit with Pastor Maldonado of Williams second and two-time defending world champion Sebastian Vettel of Red Bull starting third. The race begins at 8 p.m. in Singapore.
The grand prix costs S$150 million to organize, with the Singapore government co-funding 60 percent, Iswaran said.
“We expect to achieve a further reduction in the net cost to government through a combination of factors including optimization of infrastructure, operational efficiencies in race organization and revised terms with the race promoter and Formula One administration,” he said.
Singapore forecast arrivals to rise to 17 million and tourism spending to S$30 billion by 2015. The opening of two casino resorts that include a downtown convention center and a Universal Studios theme park spurred a 13 percent increase in visitors last year after a 20 percent climb in 2010. The country expects tourist arrivals to rise as much as 9.8 percent to 14.5 million in 2012.