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Vietnam to host first F1 Grand Prix in 2020

Vietnam to host first F1 Grand Prix in 2020

Vietnam will host its first-ever Formula One (F1) Grand Prix in 2020 after reaching an agreement of a "multi-year" deal on Wednesday. The move is part of Liberty Media's drive to bring the popular motorsport to new locations around the world.

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08.11.2018 09:26 PM

Vietnam will host its first-ever Formula One (F1) Grand Prix in 2020 after reaching an agreement of a "multi-year" deal on Wednesday. The move is part of Liberty Media’s drive to bring the popular motorsport to new locations around the world.

Vietnam’s capital, Hanoi, will be the destination for the race, with a built-in street circuit placed in the suburbs. The Vietnamese Grand Prix will take place in April 2020 and will be the fifth race in Asia that year, alongside those in Singapore, China, Japan and Bahrain.

"This is a fulfilment of one of our primary goals," Sean Bratches, Formula One’s Commercial Managing Director, said during the announcement. "Historically, Formula One has been very reactive in terms of people coming to them. We've been very proactive going to markets around the world which we think align with our brand values and the opportunity to engage fans in new ways, and a street circuit is one of the few ways that does that."

Formula One Race Director Charlie Whiting said that the organization considered Vietnam as a possible new venue in October after he visited a potential site in the west of Hanoi. The race track appears to have been in the "advanced" stages of design for some time now.

While there will be newly built structures, the layout comprises a significant number of existing streets. One further section will need completing before the Grand Prix takes place in around 17 months' time. Whiting added: "It's an open site where the pit building's going to be built. Part of the track will be built there which doesn't exist at the moment. But it will become a road, I understand, after that."

F1 management has spoken positively about Hanoi in the past and believes that it is a "destination city" that will fit neatly into the exciting and prestigious image that the motorsport is eager to push. Bratches said: "We're trying to make the racing on the circuit much more compelling. We need to get the back of the grid much closer to the front of the grid, and that is absolutely key."

Vietnam has also emerged as a growing market for sponsors in recent years, and Bratches believes that the country has everything to support F1's pivot from being primarily a motorsport company to more of a media and entertainment brand. While Liberty wants to shake up the sport, Vietnam is the first race that it has added to the official calendar since it took the reins from Bernie Ecclestone last year.

Vietnam is likely to benefit from hosting a Grand Prix in a number of ways, but it will not come cheaply, as it may cost as much as $1bn to stage a race over a ten-year period.

In other news, Vietnam’s Deputy Finance Minister, Huynh Quang Hai, said that the country plans to make it easier for foreigners to own listed companies as it attempts to drive development in a "faster, stronger and more sustainable manner." Analysts have welcomed the move, which follows a similar government decree in 2015, and believe that it could lead to a surge in interest in Vietnam's fast-growing economy.

Currently, there is a cap that prevents foreign owners from having more than 49% stake in a business, but the new draft legislation is already under submission for approval and could take effect early next year. This would remove the cap in several industries and sectors to increase overseas investment. It would also pave the way for local companies to feature in the MSCI emerging markets index.

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