The real impact of the FIFA’s World Cup


With less than a month to go, the FIFA World Cup starts on the 14thof June 2018, and the expectations have never been so big. With 352 players, 32 countries being represented and only 1 winner, audience at home are anticipating the largest football event yet. This year, its Russia’s time to host this massive event, and they are READY!

Besides the current international thrill about this event, Russians are not only extremely excited that their country is hosting this time (and hope their team wins…), but they are also aware of the impacts this tournament will have on their economy and lifestyles.


In fact, according to ESPN (2018) Russia predicts that this World Cup will have a USD 31 billion economic impact. Not bad for a football game, right? As seen in previous world cups, new stadiums have been built in each host country to accommodate the massive crowds. This year, Russia is constructing 10!!! Giving more than 13,000 construction jobs, not considering the +100,000 other jobs created by the FIFA (FIFA, 2018), such as in the security sector, hospitality industry, etc. Other positive impacts are the enormous increase of tourist visits in the hosting cities (71% according to FIFA), the 13 renovated hospitals for this event, 12 power stations, 27 new hotels, etc. (FIFA 2018), which are directly impacting positively Russian development.

Everything looks like that is the best thing that can ever happen to a country? But is this completely true?


Let’s take Brazil’s case, the country that hosted the previous World Cup in 2014. Even though the Brazilian government claimed that 1 million jobs were going to be created in consequence for this event and USD 14 billion will be introduced into their economy, statistics (post -event) show that maybe it would have been better if a different country hosted during 2014 (Odyssey, 2015). As the Swiss-based NGO Terre de Hommes mentions (2014), approximately 170,000 people lost their homes because of the preparation for the World Cup, forcing them to move to basic huts without electricity or water. Together with the gigantic investment for the event, Brazilians in 14 cities and thousands of people went to the streets rioting against the government about this event (CNN, 2014). Moreover, the CEO of the NGO mentioned above, explains that the amount the Brazilian government spent during this world cup (between £5.16bn - £7.77bn), represented the amount destined to Brazil’s social welfare programme (Bolsa Familia), which assists 50 million people each year (CNN, 2014). So, imagine how many more families could have helped in Brazil, if some of those billions would have been spent in giving them some sort of aid.



It is clear that football World Cups enhances international perception for the country. As there is a vast international exposure via media, the country becomes the focus of the international community (Liu, 2013). But what happened during the 2010 FIFA World Cup in South Africa? Were the locals happy about this competition? Let’s keep in mind that during 2010, South Africa was still a third-world country. According to a Harvard Business Review report (2010), the economic benefits to South Africans were very slim. Since less than 10% of the South African population had internet access, and tickets were sold entirely online, many Africans and locals were not able to attend this event(HBR, 2010), causing a strong dissatisfaction amongst locals.


Now, with all of this in mind I’m not saying that a football World Cup is a bad thing for a country. I am stating that this sort of events occasionally have prominent negative impacts to several countries and economies… But there are positive impacts as well J

In fact, during Germany’s FIFA World Cup in 2006, 50,000 jobs were created, the tourism industry earned an excess of USD 399 million and USD 2 billion in retail (DW, 2006). Furthermore, according to the Interior Minister Wolfgang Schäuble (2006), this tournament “had a very positive effect on the country’s economy and helped improve its image internationally”. Taking South Africa’s previous example, FIFA mentioned that more than 300,000 tourists visited the country during the Cup’s duration and the total awareness of South Africa as a tourist destination increased in 9% after the cup ended (FIFA, 2010). In fact, President Zuma (previous South Africa’s President) mentioned: "This explosion of national pride is a priceless benefit of the World Cup tournament." (The Guardian, 2018), which clearly reflects that locals (especially from an African nation) felt honored to be the focus of the international community when hosting this event.


Today, we hope that Russia will be an extraordinary host, and that the impacts this World Cup will have will be mostly positive for their economy, locals and country. After analyzing the previous examples, most of these competitions do have a positive impact in the long-term among host-countries, as a high investment in infrastructure is perceived, a better international perception towards the country is achieved, among others. However, we do need to keep in mind that in some cases like in Brazil 2014 and South Africa 2010, the locals did not really enjoyed having their countries as hosts, and indirectly influences negatively the international perception towards the country, as the locals were present in the media, acting against their government decision of hosting the world cup.

Qatar will be hosting on 2022, and according to President Donald Trump, together with Canada and Mexico, they will together host the following competition (The Guardian 2018) (of course FIFA has already negatively pronounced against this, as it’s supposed to be randomly decided, and only one country can apply, not a group…). Let’s hope they take into consideration previous mistakes made by other governments, and let’s hope for the best team to win!!


REFERENCE LIST

BBC, 2014. Fifa World Cup 'hits the poorest hardest'. [online] Available at: <http://www.bbc.co.uk/news/business-28881952> [Accessed 20 May 2018].

CNN, 2014. Strikes, violent protests hit Brazil ahead of World Cup . [online] Available at: <https://edition.cnn.com/2014/05/16/world/americas/brazil-world-cup-protests/index.html> [Accessed 20 May 2018].

DW, 2006. Germany's World Cup Report Hails Economic, Social Success. [online] Available at: < http://www.dw.com/en/germanys-world-cup-report-hails-economic-social-success/a-2263053> [Accessed 20 May 2018].

ESPN, 2018. Russia predicts World Cup will have $31 billion economic impact. [online] Available at: <http://www.espn.co.uk/football/fifa-world-cup/story/3471440/russia-predicts-world-cup-will-have-$31-billion-economic-impact > [Accessed 20 May 2018].

FIFA, 2010. Study Reveals tourism impact in South Africa. [online] Available at: <http://www.fifa.com/worldcup/news/study-reveals-tourism-impact-south-africa-1347377> [Accessed 20 May 2018].

FIFA, 2018. Impact and legacy of 2018 FIFA World Cup Russia. [online] Available at: <http://resources.fifa.com/mm/document/tournament/competition/02/86/77/63/Impactandlegacyof2018FIFAWorldCup_EN_neutral.pdf> [Accessed 20 May 2018].

FIFA, 2018. Impact and legacy of 2018 FIFA World Cup Russia. [online] Available at: <http://resources.fifa.com/mm/document/tournament/competition/02/86/77/63/Impactandlegacyof2018FIFAWorldCup_EN_neutral.pdf> [Accessed 20 May 2018].

Harvard Business Review, 2010. Is the Wolrd Cup bad for South Africa?. [online] Available at: <https://hbr.org/2010/06/is-the-world-cup-good-for-south-africa> [Accessed 20 May 2018].

Lui, Yundong. 2013. Assessing the Long-term Economic Impacts of the World Cup as Mega-sport Event. [online] Available at: <http://pitjournal.unc.edu/article/assessing-long-term-economic-impacts-world-cup-mega-sport-event> [Accessed 20 May 2018].

ODYSSEY, 2015. Six Months Later: The World Cup's Effect On Brazil. [online] Available at: <https://www.theodysseyonline.com/six-months-later-world-cups-effect-brazil> [Accessed 20 May 2018].

Ramdas B., Van Gaalen R., Bolton, J., 2015. The Announcement Impact of Hosting the FIFA World Cup on Host Country Stock Markets. Procedia Economics and Finance, [e-journal] (30). Available through: <https://www.sciencedirect.com/science/article/pii/S2212567115012903> [Accessed 20 May 2018].

The Guardian, 2018. 'We will be watching': Trump defies Fifa with repeat threat over World Cup bid. [online] Available at: <https://www.theguardian.com/football/2018/apr/30/donald-trump-world-cup-bid-threat-fifa> [Accessed 20 May 2018].

#worldcup #fifa #entrepreneurship #russia2018 #startups #umbrella

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