The Middle East, backed by its vast oil wealth to build huge tourist attractions, is now a strong rival in the race to attract more foreign visitors, according to former Singapore prime minister Goh Chok Tong.
Singapore was no longer just competing with Thailand, Malaysia, Hong Kong and China for tourism, he said on Wednesday.
"We are also competing against Dubai, Qatar and other countries in the Middle East."
"Dubai and Qatar are not re-inventing themselves. They are inventing themselves in a big and bold way," Goh said.
Singapore now has to contend with the challenge from the region which is rapidly diversifying its economy away from the oil sector, said Goh, who is now senior minister after stepping down in August.
"They are not just targeting Arab dollars but tourists from around the world," Goh, 63, said in a speech in parliament.
Casino issue
It is therefore in Singapore's long-term economic interest to give the green light for two casino resorts to be built, Goh said.
The casino project, which was given the go-ahead by the government on Monday, has sparked a strong public outcry in the city-state since the idea was first floated last year.
Goh's remarks on the controversial casino projects came one day after Lee Kuan Yew, the city-state's founding father, said in parliament that Singapore stood to lose if it rejected the projects that could bring in billions of dollars of investment.