Economics of the 2010 World Cup in South Africa

Abstract

The FIFA World Cup is the world's largest and most viewed sporting event. South Africa is one of the first developing countries to host such an event, the first of its kind on African Soil. South Africa relentlessly pursued the right to host the World Cup and finally got the chance in 2010. Economically, is the World Cup a good investment for South Africa? What are the costs and benefits associated with the World Cup? This paper analyzes the costs and benefits associated with hosting an event of this magnitude. It draws on research from past mega-events and World Cups to assess the costs and benefits associated with the event. In conclusion the economic benefits that were so widely heralded are likely to never materialize. The initial estimates that the World Cup would only cost $421 million were grossly understated; current costs are currently accrued at over $5 billion dollars, over 11 times the initial assessment. With stadiums built without any conceivable use other than the World Cup, the economic impact will be negligible . Positive impacts the World Cup will have on South Africa will be considered intangible. The World Cup gave South Africans the opportunity to form a collective identity and rally around their country, this cannot be understated with the long history South Africa has had. Economically the World Cup will not benefit South Africa. The image enhancement of South Africa, collective identity, and to some extent infrastructure development will be the .legacy of the 2010 South African World Cup.