THE world enjoyed it and so, in the end, did the Brazilians. After the huge protests of a year ago against their government’s profligate spending on the World Cup, Brazilians suspended their protests and focused on football — as did the world — over the past month. And whereas going into the tournament, a poll found only 45% of them said they were proud to host the tournament, by the time it drew to a close, the proportion had increased to 60%.
They had reason to be proud. Brazil pulled off a successful World Cup, despite the chaos and cost overruns in the preparations. The football was goal-rich and exciting. The country and its citizens have been praised for their warmth and friendliness.
What the World Cup did not do for Brazil is boost its lacklustre economy. Economists have recently revised down growth forecasts, both frequently and sharply, and some of the numbers sound eerily familiar to South Africans.
After four years of sluggish growth, ratings agency Moody’s now expects Brazil to grow only 1.3% this year, and 1.5% next year. The consensus for this year is even lower, at not much more than 1%. Inflation is close to the top of the target range, which is 6.5%. There is a current account deficit and public finances are deteriorating.
The International Monetary Fund cites Brazil’s weak infrastructure, low levels of private investment and lack of investor confidence as factors in its anaemic growth rate.
The World Cup has hardly helped at all, despite the billions of dollars spent on stadiums and other infrastructure. On one estimate, the tournament will have contributed no more than 0.2 of a percentage point to economic activity this year, and the Rio Olympics in 2016 won’t do much more than that.
Brazil’s economy is much larger than South Africa’s. So the net effect of mega-events is less pronounced. Indeed, some have argued that advanced countries such as Germany, with very well developed infrastructure, stand to derive much greater financial benefit from events such as the World Cup as they don’t have to invest as much — but the revenue is significant.
News, views, analysis and multimedia coverage of the Brics nationsThey may be better able, too, to deal with the excessive demands and curbs which Fifa imposes — demands that were one of the issues in the protests by Brazilian citizens.
There is evidence, though, that mega-events have only a negligible effect on longer-term economic growth in the countries that host them. Benefits are often outweighed by the cost — particularly, stadium white elephants.
Countries hosting these events should be careful to ensure they are financially viable and can be funded without too much strain to the fiscus.
More important, however, the focus needs to be on the legacy, beyond the numbers or the narrow cost-benefit analysis.
If Brazil’s World Cup has highlighted anything, it is the question of the legacy a World Cup leaves. The Financial Times’ brilliant football and economics columnist, Simon Kuper — who has attended the past seven tournaments — concludes the tournament won’t make Brazil a richer country, just a better one.
The anti-World Cup protests were as much about government accountability as they were about stadiums. The tournament jerked millions of previously docile Brazilians into political consciousness, he says, and started a national conversation about what kind of country they want.
Added to that, World Cups are good for football, boosting attendance for years afterwards — and surveys show they make people happier for a while.
South Africa was well aware of the need to ensure the World Cup left a legacy in terms of infrastructure. With the 2010 tournament as a trigger, we did get quite extensive upgrades to airports, roads and other transport infrastructure as well as the fast-tracking of the Gautrain.
If we went wrong, it was perhaps that we didn’t take enough advantage of the energy, focus and partnerships that the World Cup prompted, to build even more public transport and other infrastructure to leave a longer-term legacy to support economic growth and service delivery.
Change: -0.47%
Change: -0.57%
Change: -1.76%
Change: -0.34%
Change: 0.02%
Data supplied by Profile Data
Change: -1.49%
Change: -0.04%
Change: -0.47%
Change: 0.00%
Change: 0.08%
Data supplied by Profile Data
Change: 0.36%
Change: 0.61%
Change: 0.12%
Change: -0.29%
Change: 0.82%
Data supplied by Profile Data
Change: 0.31%
Change: -0.42%
Change: 0.33%
Change: -1.40%
Change: -0.96%
Data supplied by Profile Data