America's Cup could bring in $1b: MBie

Hosting the America's Cup would give New Zealand's economy a boost of up to $1 billion, according to a new report. Photo / File

Hosting the America's Cup would give New Zealand's economy a boost of up to $1 billion - and create up to 8300 jobs, according to a new MBie report.

The Ministry of Business, Innovation and Employment this morning released its High Level Economic Assessment Evaluation report for the 36th America's Cup.

Its key findings include an estimated benefit of between $600 million and $1b to New Zealand's economy from 2018 through to 2021. MBie estimates hosting the event would also create between 4700 and 8300 jobs.

"The economic evaluation does not capture any of the broader benefits associated with hosting an event of this scale, including showcasing New Zealand to international audiences - and associated reputation impacts - high performance sport outcomes and participation and engagement of New Zealanders that may have 'feel good' effects [such as] increasing national identity and pride," MBie said.

Sectors to reap the benefits included services, manufacturing (mainly around boat building and super yacht refits), tourism, hospitality and accommodation.

The cost-benefit analysis ranged from 1.2 to 1.8.

"This cost-benefit ratio is for the economy as a whole; the costs included relate to all parties including, for example, the Crown, Auckland Council, syndicates, Emirates Team New Zealand, retailers and tourism providers."

The divergence in the estimated benefits reflected different assumptions about the number of syndicates that would compete, how many super yachts would visit and international tourist numbers.

However, MBie said its findings were in line with Treasury guidelines for studies of this kind.

"The study makes no assumptions around location or whether there are any incursions into the harbour or not. It does not, therefore, take account of any loss of value from reducing the available harbour space."

Debate is ongoing between Team New Zealand, Auckland Council and the Government about the most appropriate space to host the event.

"The America's Cup is an iconic event in New Zealand's sporting history. Successive governments have seen the benefits that flow from investing in both the event itself [when held in New Zealand] and from investing in Team New Zealand ... even when the event is not going to be held in New Zealand. The flow-on effects for New Zealand's marine industry and 'Brand New Zealand' are significant," the report concluded.

"By taking a longer view, that is, by including the activity generated by additional super yacht visits to 2055, the economic gains outweigh the costs. Our modelling suggests that over the long term [out to 2055] every $1 invested in the infrastructure generates approximately $7.50 of economic activity."

Lobby group Stop Stealing Our Harbour says while it was excited about the next America's Cup, and wants it hosted in Auckland it was concerned about the economic benefits being exaggerated.

Economic Impact Assessments (a GDP based assessment methodology) had been discredited and should not be used for decision making purposes.

''SSOH believe that a proper cost benefit analysis will show any benefit to hosting the America's Cup to be significantly less than what has been touted.''.