THE tourist economy in the North-East has grown from virtually nothing to be worth £1bn a year in just 15 years, it was claimed yesterday.

The figures were used as an example of how culture-led regeneration could have tangible economic benefits to the region.

Andrew Dixon, chief executive of the Newcastle-Gateshead Initiative and former chief executive of the Arts Council in the region, said that until recent years, the North-East had suffered from 100 years of under-investment in the cultural sector.

Now, the region had £200m of world class facilities in The Sage, The Baltic, Live Theatre and Seven Stories, and an international reputation for the arts.

In economic terms, the creative industries now had a turnover of £2.6bn and employed 59,000 people - more than five per cent of the region's workforce.

In tourism, the sector had grown to be worth £1bn a year and the region had opened 1,000 new hotel rooms in the last three years, led by events such as the Tall Ships Race, which attracted 1.5m visitors to the North-East this summer.

While Mr Dixon admitted that the prestige developments on the Tyne Quayside had been social strategies rather than economic strategies, he said: "The cultural renaissance is driving a new phase of the region's regeneration."

The debate also heard from Premier League chief executive Richard Scudamore, who said that, while the region's big three football clubs had a combined turnover similar to a single out-of-town supermarket, they had an important effect on raising the international profile of the region.

Meanwhile the Duchess of Northumberland, who developed the award-winning Alnwick Gardens, outlined how important the attraction had become to the economy of the market town and its surrounding area.

She told the audience at yesterday's forum debate, chaired by Sir Ian Wrigglesworth, that the garden attracted 500,000 visitors a year, almost 60 per cent of them from outside the North-East.

A recent study by Alnwick District Council estimated that the gardens are worth £45m a year to the local economy.

The Duchess said: "It brings people to spend their money on locally-produced food and souvenirs and, most importantly, it creates jobs for local people."

She added: "The garden is real proof that cultural regeneration leads to economic development, not just through increased spend, but through changing minds and hearts."