Malaysia shouldn’t bring back F1 – economic experts

The subject of potentially bringing Formula 1 racing back to the Sepang International Circuit (SIC), or at least the idea of it, has come up once again, but not everyone is keen on the thought being explored, given the associated high costs that would be involved.

Some quarters are saying that the multi-million ringgit price tag could outweigh any potential benefits of having the race return to Malaysia, considering the country’s current economic and social pressures, as The Sun reports.

Economist Geoffrey Williams said the government should not be made to foot the bill to finance the event using public funds. “If hosting F1 is viable from an economic and business perspective, it should be funded entirely by the private sector. If it is not viable from a private investment perspective, then government investment makes no sense either,” he told the publication.

He added that the country’s F1 journey, which ran for 19 years from 1999 to 2017, should serve as a past lesson rather than an aspiration for the future. “It was not sustainable and did not deliver the economic, social or multiplier effects often claimed by proponents of government involvement. If it had delivered benefits, it would still be running. It did not, hence it was discontinued,” he said.

The publication also spoke to a businessman, who wanted to remain anonymous, and he echoed the same concerns, saying that the potential cost was unnecessary and would be misaligned with national priorities.

“Spending US$70 million (about RM295 million) for a single Formula 1 race is totally unnecessary. Once setup and related costs are included, Malaysia could pay more than RM300 million for just one event,” he said.

He suggested the funds could instead be used on helping Malaysians in need of aid. “That RM300 million could subsidise 20,000 B40 families with RM15,000 each, helping them financially to own their first home. Supporting 20,000 families would directly benefit at least 100,000 Malaysians,” he said.

He questioned the need to return to F1 after its long involvement with the sport. “We have hosted F1 for 19 consecutive years. Isn’t that enough? With more countries vying to host, fees will only rise. The owners of F1 are savvy and business-minded, not generous. A wiser approach would be to use that money to improve the lives of Malaysians rather than compete for prestige,” he explained.

The talk about a potential return resurfaced after SIC CEO Azhan Shafriman Hanif said earlier this week that it was a mistake for Malaysia to stop hosting Formula 1 one races, prompting the discussion to take off once again, with some reports indicating that the race was set to return, prompting him to state that it was not.