2010: ‘R55bn boost for SA economy’

26 November 2008

With the world’s leading economies sliding into recession, economists are predicting a tough couple of years for South Africa’s economy. The country does have one ace up its sleeve, however: the 2010 Fifa World Cup.

According to a new study released on Friday by consulting firm Grant Thornton, the world’s biggest single-code sporting event will pull an extra half-a-million foreign tourists into the country in 2010, injecting an additional R8.5-billion in tourist spending into the economy.

The World Cup’s total contribution to South Africa’s gross domestic product (GDP) will be a massive R55.7-billion, of which R33-billion will be in direct spending on stadiums and infrastructure (R17.4-billion in 2010 alone), spectator trip expenditure (R8.1-billion), ticket sales (R6-billion), rights and sponsorships (R750-million) and other items.

Just over 415 000 jobs will be created in tourism, transport, construction and other industries.

And the benefits will go well beyond 2010, with an indirect impact that may be even more meaningful for a sustainable economic lift in subsequent years.

With an expected global television audience of 35 to 40-billion “cumulative viewers”, around 487 000 foreign visitors, and a 19 000-strong visiting media contingent, the World Cup presents South Africa with a marketing opportunity second to none.

The resulting tourism legacy, according to Grant Thornton, will be two-fold. Crucially, the event will make South Africa a better, more widely known and understood destination, with – barring major problems – an enhanced reputation for service and a quality travel experience.

But the World Cup will also leave behind a greatly improved tourism infrastructure, in the form of increased accommodation (about 35 new hotels will have been built); improved public transport; bigger bus, coach and hire car fleets; better tourism information and destination management; and more efficient tourism industry supply chains.

South African tourism will benefit for years to come, Grant Thornton predicts – basing its forecasts on the experiences of other countries that have hosted major events – with between 130 000 and 290 000 extra foreign arrivals a year from 2011 through 2015 expected on account of the World Cup effect.

Gillian Saunders, director of Grant Thornton Strategic Solutions, said the possible effects of the global economic downturn had been taken into account in the study.

The nature of the World Cup and the kind of supporters it attracted meant that interest in the event would survive the credit crunch.

“Of course the global recession will deter some would-be visitors,” Saunders told Business Day, “but if we have a structurally weakened currency, South Africa will look like a very attractive holiday destination.”

SAinfo reporter

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