Читать книгу New South African Review 1 - Anthony Butler - Страница 38

An economic argument about the potential effects of the World Cup was an important part of political leaders’ efforts to gain domestic support for the bid. Since the launch of the initial bid a number of years ago, estimations of the likely effects of the 2010 tournament on the South African national economy were to see some significant revision. In 2003, Grant Thornton, the consulting company contracted by the South African 2010 Soccer World Cup Bid Company to appraise the World Cup’s long-term consequences, produced a study on the event’s potential economic legacy. The company assessed direct expenditure by four sources: spend at the event by domestic and international spectators; trip spend by spectators, teams and their entourages, the media, sponsors and FIFA office bearers; other spend on merchandising and concessions; and capital expenditure on infrastructure and stadiums. Using cost-benefit analysis, the company projected that the tournament would produce direct expenditure by spectators of R12.7bn, that it would contribute R21.4bn to the gross domestic product and create an additional R7.2bn in government taxes, and that the event would generate the equivalent of 159 000 annual jobs (although it was unspecified how many of those jobs would be permanent or temporary/seasonal and at which levels they would be created). The study anticipated that the direct cost of the World Cup, mainly arising from expenditure on the upgrade of stadiums and infrastructure, would be (a rather modest) R2.3bn (see Grant Thornton 2003).

In 2008 and again in 2010, shortly before the start of the tournament Grant Thornton updated the initial forecasts based on revised data, their more recent analyses showing some significant variation from preliminary assessments (see Grant Thornton 2008; 2010). Table 1 details projected costs and benefits from the studies.

From the table it is clear that expectations for 2010’s macroeconomic impacts were to rise significantly, with national income anticipated from the tournament subsequently becoming more than double the volume projected in initial assessments. Yet there were some major deficiencies in these projections. The most important related to the identification and balancing of costs versus benefits. The cost-benefit methodology used by Grant Thornton is widely used in mega-event impact studies and because of its relatively easy and saleable format disseminates well in pro-event and political circles. This methodology has however been criticised by many sports economists for its potentially flawed assessment of the true costs of hosting an event, in particular its predisposition to consider money spent on infrastructure improvement (including development of stadiums) as a form of income, rather than a cost. As suggested above, construction costs for the development of infrastructure related to a sport mega-event can variously place additional strain on a national or regional economy, can drain resources from surrounding areas and, if materials or labour need to be imported, may constitute a source of revenue leakage. As such, while they may have obvious benefits, infrastructure upgrades are more appropriately considered an opportunity cost and should be factored in to impact assessments in that way (see Matheson 2008 for a lucid discussion).

From table 1 it is evident that the Grant Thornton study did not do this, projecting for instance in 2008 potential total impact of R55bn from the World Cup (which was revised upward to R93bn in their 2010 study). This is based on the misleading inclusion of expenditure on stadium upgrades (R33bn) as part of the event’s contribution to GDP and was therefore an inflated estimate of the event’s income potential. If anything, escalation in stadium construction costs was to become one of the more worrisome features of World Cup preparations. By the end of 2008, for instance, budget overruns for stadium construction – caused by a variety of factors, including high international prices for construction material such as cement – was estimated at R3.2bn (Business Day 2 December 2008). By the time the FIFA tournament took place, expenditure on the upgrade and construction of stadiums was considerably more than the money initially committed by the national government as part of its World Cup investments.

Table 1: Changes in official projections of impacts of 2010 World Cup

	2003	2008
Benefits (income)
Contribution to GDP consisting of:	R21.4bn	R55bn
stadium & infrastructure upgrade		R33bn
sale of match tickets		R6bn
trip spend by spectators		R8bn
sponsorship		R750m
Additional tax income	R7.2bn	R19bn
Costs
Upgrade of stadiums and infrastructure	R2.3bn	R33bn
Other impacts
New employment	159 000	415 000
Foreign (overseas) tourist arrivals (number)	235 000	480 000
consisting of African tourists (number)	45 300	150 000
Tourism receipts		R8.5bn
International media presence (number)	10 500	18 000
Major development projects (unspecified and unquantified)
Source: Grant Thornton 2003; 2008

Two additional problems with the Grant Thornton estimations are first, the anticipated fiscal and employment contributions of the World Cup, and second, the projected tournament tourist visitation. In an earlier critique, Bohlmann (2006) cautioned that the impact and employment multipliers used by Grant Thornton tended to be over-optimistic in comparison with other impact studies carried out for similar events. It was also not specified in the Grant Thornton studies whether the projected employment stimulated by the tournament would be long- or short-term or how the jobs would be affected by seasonal variation in demand. From other studies it has been shown that, while revenues may increase in specific sectors (such as accommodation) for the short period during which a tournament takes place, wages remain the same or – since there is often a sharp rise in casual employment in that time – may fall. Employment multipliers used in many ex ante studies often do not take these processes into account and therefore tend to be exaggerated (Matheson 2008). No comprehensive study has yet been done on the leakage and income attrition effects of construction for the 2010 tournament on the national economy. Notably, however, early post-event assessments suggest that employment in the construction sector fell sharply – by more than 10 per cent – after the completion of World Cup infrastructure (Sapa 22 June 2010).

Finally, there was to be much dispute about whether the 2010 World Cup would draw the numbers of tourists estimated by South Africa’s tourism authorities (see for example Cornelissen 2009b). By the close of the tournament, over one million foreigners had visited South Africa during the four-week period, representing a year-on-year increase of 25 per cent (or 200 000) additional tourists, but still significantly short of the close to half-million foreign visitors initially projected. No systematic study was conducted by the authorities that profiled World Cup visitors in terms of football spectators’ specific travel habits, nor did broad projections of expected tourist arrivals take possible displacement or crowding-out effects adequately into account.

In expectation of the World Cup’s projected economic effects, the national government undertook to spend more than R400bn over the four-year period between 2006 and 2010, as part of a much larger capital investments programme to develop infrastructure, upgrade ports of entry, roads and railway lines and secure the provision of energy (Manuel 2007; and see table 2). At the end of the tournament, public investments stood at around R600bn. Although only R21.6bn of this (R11.8bn for the development of transport and other infrastructure and R9.9bn for the construction and improvement of the competition venues) was regarded by the government as its direct expenditure on the World Cup, it should be kept in mind that these investments would not have been made in the absence of the tournament. As such, the R600bn should properly be viewed as part of the World Cup expenditure legacy.

Table 2: Spending commitments by the national government relevant to the World Cup, 2006–2010

World Cup specific spending	Value
Infrastructure
Stadium upgrades and construction	R8.4bn
Transport and other infrastructure	R9bn
Non-infrastructure investments
Volunteer, social/community development & sport development	R379m
World Cup opening & closing ceremonies	R150m
Security surveillance & deployment/training of security personnel	R666m
Upgrade of telecommunications & improvement of emergency medical services	Unspecified
Capital investments not directly related to the 2010 World Cup
comprising construction and upgrade of national road networks; airports; harbours; energy supply	R400bn+
Source: Manuel 2007 & www.sa2010.gov.za/en/funding.

The positive aspect of this is that, as part of World Cup preparations, public investment was made on much needed infrastructural programmes. A significant portion of the R400bn+, for instance, was dedicated to the upgrade of South Africa’s dated road network (of which the South African National Roads Agency was the principal beneficiary) and the improvement of public transport. Other investments concerned the extensive upgrading of all international and some regional airports (which tally in excess of R19bn). Yet these investments constituted approximately one-tenth of South Africa’s annual gross domestic product (estimated at purchasing power parity), and represent, over the longer term, a substantially higher cost for the tournament than what was spent by the German authorities for the 2006 World Cup (approximately R72bn). By way of further comparison, the 2008 Beijing Olympic Games cost about R196bn and was the most expensive Summer Games ever hosted in the history of the modern Olympics.

While the intention of South Africa’s authorities therefore was to use the 2010 World Cup to stimulate new large-scale developments in the country, it came at a prohibitive cost, and was made without guarantee that the tournament would deliver on many of the projected economic spin-offs.