The New Zealand Government’s $33.75 million subsidy of Emirates Team New Zealand’s 2007 America’s Cup challenge boosted the economy by $2 for every dollar invested, Associate Finance Minister Trevor Mallard said today.
An economic impact report prepared by consultants Market Economics said the effects were greater than $35 million to $53 million estimated in 2003 because Team NZ gained more funding from overseas sources.
The foreign sponsorship helped fund the $130 million spent on the challenge, much of it while the yacht crew prepared at Team NZ’s Auckland base for the regatta hosted in Spain.
The study estimated the Team NZ challenge added between $62.2 million and $74 million to the economy through additional activity and flow-on effects, with most of it assisting Auckland.
It also generated between 750 and 900 jobs.
The spending generated an estimated extra $32.4 million to $39.4 million in tax take for the Government.
The report said there were less tangible but wider benefits from the challenge in terms of raising the profile of New Zealand and in particular the marine industry.
Mr Mallard said the report showed the America’s Cup was an ideal opportunity to showcase New Zealand’s boat-building, sailing and design talent.
“It’s also good to know the projected return on the Government’s investment was better than we expected,” Mr Mallard said.
The Government decided to pump the money into the challenge after the 2003 regatta to stop personnel from that challenge going to overseas syndicates before sponsorship could be found.
Team NZ won the challengers series but lost in the final five races to two.