HO CHI MINH CITY -- Vietnam will host its first-ever Formula One race in April 2020, bringing the prestigious series to a country where auto racing is a very new sport.
The capital city of Hanoi will hold an event Wednesday to announce details about the venue and schedule, according to invitation letters.
Environmental issues and the rising popularity of electric-vehicle races have driven the Paris-based FIA, or Federation Internationale de l'Automobile, to seek new frontiers such as Vietnam to revitalize the world's most popular auto racing series.
Malaysia withdrew from the annual series after 2017, citing competition from neighboring Singapore, which remains one of the venues. Malaysia began hosting a race in 1999, while Singapore joined in 2008. Vietnam would be the third Southeast Asian country to host an F1 competition, which could be held annually.
The Hanoi city government will cooperate with Formula One to manage the project, including raising funds, building the road and hosting the race. Yet the city faces obstacles in raising capital for the race infrastructure as it will not be permitted to use the state budget, a traditional source in the state-owned economy. City leaders estimate the initial cost will start from $60 million. The city said the 6 km track and related facilities will be built in the coming months.
Vietnam's government ordered the city to raise funds from the private sector. The Hanoi city authority said Friday that private enterprises are willing to participate in funding, but did not reveal the names.
Property conglomerate Vingroup is on the list of organizers, along with the Hanoi city authority, the Formula One Group and Grand Prix Vietnam. Vingroup entered the auto industry last year, involved in international and local activities of late.
Experts estimate it will cost more than $1 billion to build a new racing road.
Vietnam's legalization of sports betting in 2017 has attracted more events such as motor racing. The Vietnamese sports authority hoped to bring the event to the country years ago, but faced barriers related to gambling.
Sources in the auto industry, sports and entertainment said Vietnam was ready to pay roughly $400 million annually for the right to host an F1 race for 10 years. However, Formula One Group in 2017 refused the proposal, saying the country lacked experience in the field.
Last year, U.S. firm Liberty Media took over Formula One for $8 billion, and the new owners have said they are keen on exploring new regions.
Hanoi negotiated a final agreement to host the event in April 2020, a city Department of Culture, Sports and Tourism officer told local media earlier. The event aims to promote Vietnam and attract more tourists.
Hanoi initially planned to build a racing circuit around Hoan Kiem Lake at the center of the city. But city officials have decided to move the project to a site west of Hanoi near My Dinh National Stadium, where the roads are wider.
Agence France-Presse cited F1 race director Charlie Whiting last month, reporting that he visited the site and was confident that it would be ready for the 2020 season. The race would take place on existing roads, but some sections would need to be built.