2010 boost for SA economy
15 May 2007
The 2010 Fifa World Cup will have an even greater impact on the South African economy than previously thought, with consulting firm Grant Thornton estimating that the event will contribute at least R51.1-billion to the country's gross domestic product (GDP).
This is against the original estimate of R21.3-billion, which was presented in a financial impact report by Grant Thornton's tourism, hospitality and leisure division for South Africa's World Cup bid committee in 2004.
According to Business Report, R15.6-billion of the revised estimate will be brought in by foreign tourists. The new figure includes direct expenditure of R30.4-billion, up from the initial estimate of R12.7-billion.
"A huge chunk of it comes from infrastructure, particularly transport infrastructure, because the government is now spending five to six times more than what they had initially planned to spend," Grant Thornton's Gillian Saunders told Business Report this week.
The number of stadiums to be used during the World Cup have also increased, while seating capacity at the Port Elizabeth, Cape Town and Soccer City (Johannesburg) stadiums has grown.
According to the paper, while the original estimate was for 2.7-million tickets to be sold, generating revenue of R4.6-billion, 3.2-million tickets will now be available for sale.
Grant Thornton told Business Report that its economic impact findings were based on 289 000 overseas visitors watching three to four matches each, 48 000 African visitors watching three matches each, and about 115 000 domestic tourists watching two matches each.
Calculations are based on a stay of 15 days, as most foreign tourists are not expected to stay for the entire month-long tournament.
In addition, about 100 000 African and 25 000 overseas non-ticket holders are expected to visit during South Africa during the event, the company told Business Report.
Following the release of Grant Thornton's first estimates in 2004, a number of analysts said they believe the biggest long-term benefits of the World Cup for SA would come from "intangibles" such as an enhanced international profile and an increased sense of pride and unity among Sout Africans.
"There will be a big direct injection for the economy," Standard Bank economist Goolam Ballim told news agency Reuters. "But the indirect impact may be more meaningful for a sustainable economic lift in subsequent years ... It will help change the perceptions that a large number of foreign investors hold of Africa and South Africa."
SouthAfrica.info reporter
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