FELT IMPACT BEYOND THE TOURISM SECTOR
With the renewed contract now in Singapore on the F1 Grand Prix calendar until 2028, the event will create a “vibe” in a tourism sector which has been hit hard by the pandemic, said F1 analyst Dr Michael Chiam. tourism and deputy director of Ngee Ann Polytechnic’s School of Business and Accountancy.
While these financial benefits that will accrue to Singapore’s economy and hospitality industry will be “initially small”, the “fundamental positive impacts” will remain, added Mr. Ben Cassim, Director of the Hospitality and Tourism Management Degree at Temasek. Polytechnic.
These benefits include an influx of tourism revenue and demand for hotel rooms during the race period, especially for hotels near the race circuit, he said.
But the ripple effects of the F1 Grand Prix will also be felt by other sectors outside of tourism.
The event will be creating businesses for local businesses and jobs for locals, from project contracts to part-time work, Dr. Chiam and Mr. Cassim pointed out.
They pointed out that F1 racing will also benefit the F&B, attraction, retail and transport sectors.
“Other potential beneficiaries include…(the) medical (sector). More significant would be the business networking opportunities the event will provide to the various industries and sectors that operate in Singapore,” Mr Cassim said.
On the other hand, Mr. James Walton, head of the sports business group at Deloitte Southeast Asia, noted that the length of the renewed contract “brings up new and interesting partners” outside of industries that have traditionally benefited from the event.
“The seven-year span is partly due to the desire to transform the event to be more sustainable and a sandbox for innovation,” he said.
“With a three- or five-year contract, companies may have been reluctant to invest in developing new technologies. But with a seven-year track, we will see companies partnering with organizers and the government to come up with solutions more efficient lighting systems, biodegradable and recyclable options for wayside waste and alternatives to single-use plastics.”
Walton pointed out that he is a “multiplier effect” in the local economy, as “typically 90% of race organization is outsourced to Singapore-based companies, and around 30,000 people get short-term employment before, during and after the event”.
However, he said the economic impact cannot yet be estimated for 2022, until much closer to the event.
“Local attendance will also depend on track capacity, due to safe distancing, and off-track entertainment options,” he said.
“The best-case scenario for 2022 will be to break even for Singapore. But ultimately, we expect to return to more positive numbers from 2023 onwards, should the local and global approach to the COVID-19 situation continue to improve. ‘to advance”.
SINGAPORE ‘OPEN AND SAFE’ AGAIN
At the moment there is no denying that the Singapore Grand Prix contract renewal is a “huge” statement, Mr Walton said.
This indicates that Singapore “is ready to move forward post-pandemic and attempt to return to hosting international mass spectator events.”
“In terms of what it could do to boost the tourism and catering sectors in the coming months, but also in terms of cementing our place as one of only two F1 Grands Prix in Asia for the coming year and possibly longer as the calendar fills up,” he added.
The flagship event is also an “affirmation” of the importance of the events industry to Singapore’s economic growth, especially in light of the disastrous impact of COVID-19 on the industry, added Mr Cassim.
“Given the extended seven-year renewal agreement, this brings some hope to people living in Singapore during these uncertain times. Hope is one of the major motivating factors that keep societies moving forward, so the impact here should not be ignored.”
But there are still a lot of things pending, Mr. Walton said.
“WWhat will off-track concerts and events look like in a safe distance future? Similarly, how do you manage the safety distance in seating areas like the pit lane? What route will the track take given the new construction of NS Square? How many tourists can we expect to bring in and what will the vaccinated travel regime look like? How many spectators can realistically attend over the next two years, given all of the above?
Despite the many factors that need to be resolved over the next eight months, Mr Walton said the renewed contract was a “very positive step” and provided a platform to work from.
Ultimately, we need signature events to entice people to travel, he added.
“Sports fans are eager to attend live events in Asia, having seen the return of stadiums and tracks in the United States and Europe in recent months.
“But in addition to these F1 ‘petrolheads’, (F1 racing) can also serve as a call to tourists around the world – that Singapore is open and safe – as the world opens up again.”