Singapore hopes F1 race gets tourism back on track
With big names like Nico Rosberg, Lewis Hamilton, Fernando Alonso, Jennifer Lopez, John Legend and many other internationally famous people coming, Singapore will be counting on its marquee Formula One race to help make up for a 30 percent drop in Chinese tourists this year.
The three-day event, including the night street race, clocks more than S$100 million in tourism receipts and opens a window on the country for a global television audience.
Nico Rosberg and Fernando Alonso are two fo the big names that are here in Singapore this week for the race. Photos: AFP
A steady stream of Chinese high-rollers into Singapore's two casinos helped the tourism industry grow at a compound annual rate of 10 percent over the last three years.
Tourist arrivals dropped nearly 3 percent in the first half of this year - the first such decline since the casinos opened in 2010. Singapore is on pace to record the biggest drop in Chinese tourist arrivals since it landed a spot on the F1 circuit seven years ago.
"This year, Singapore is certainly banking a bit more on the F1 event to come back into the limelight after weak tourism numbers in the first half," UOB economist Francis Tan said.
While the haul from the race itself represents a tiny portion of the expected 2014 tourism receipts of as much as S$24.6 billion, it marks an opportunity for Singapore to sell itself as a country that works hard and parties as hard.
"Every year, the race season in September brings about an influx of international tourists and media exposure for the country," said Cassandra Tan, an analyst with Euromonitor.
The Four Seasons Hotel, for example, expects business volumes this weekend to rise 25 per cent over a non-race weekend.
Singapore Airlines is betting on the event to drum up interest in its premium brand as it sponsors the race for the first time.
Photos: Reuters, ST
WINNING BACK CHINESE TOURISTS
The drop in Chinese tourists has hit Singapore's casinos, analysts say.
Tourists from China were also wary of traveling to the region because of political unrest in Thailand, the disappearance of a Malaysia Airlines flight and a new Chinese law that clamps down on ultra-cheap tour packages.
Combined VIP volume for Genting Singapore's Resorts World Sentosa and Las Vegas Sands' Marina Bay Sands fell 10 per cent in the first half of this year, Macquarie Research estimated. China typically accounts for at least half of the VIP gamblers in Singapore.
Singapore relies on tourism for about 4 percent of its economic output. It expects international visitor arrivals to rebound and grow 5 per cent to 8 per cent in 2014.
With more than 15 million tourists last year, Singapore has cause for optimism, industry analysts said.
"Any country would be happy to have three times its population visiting per year in tourist numbers," said Jonathan Galaviz, a partner at consultancy Global Market Advisors. - Reuters