A business case to redevelop Melbourne Park, where the Australian Open tennis Grand Slam is held, has been announced in Melbourne yesterday.

John Brumby, Victorian Premier, announced the government will invest 1.5 million Australian dollars (about US$1.3 million) to upgrade the Melbourne and Olympic Park Precinct, which includes the Rod Laver Arena, the Vodafone Arena and the new Rectangular Stadium.

"This business case will investigate what improvement and upgrades are needed to this precinct to ensure that Melbourne remains competitive in attracting the world's best sport and entertainment events," Mr. Brumby said.

"The investigation will look at a number of thins including improving spectator amenities and player facilities, expanding media and broadcast capacity, improving access to the grounds and opening up the precinct to greater community use," he said.

Brumby said facilities and events like the Australian Open were part of a major events program that contributed about one billion Australian dollars to the Victorian economy every year.

"Crowds at the Australian Open grew from under 300,000 in the late 1980s to over 550,000 last year and the proportion of overseas spectators almost doubled since 1999," he said.

"With Tennis Australia predicting public demand will continue to increase and is likely to reach 650,000 within the next 10 years. We need to ensure that we can cater for that demand into the future," he added.