Unpacking the World Cup legacy

26 July 2010

The government estimates that the 2010 Fifa World Cup has added one percentage point to South Africa’s economic growth for 2010/11, when spending on stadiums and infrastructure is taken into account.

Initially, the government estimated that the World Cup would add 0.5 percentage points to the country’s gross domestic product (GDP) growth this year.

However, Finance Minister Pravin Gordhan told guests at a dinner hosted by the International Marketing Council last week: “When we take account of the spending on stadiums and infrastructure since 2006, we find that the level of GDP is about 1 per cent higher than it would have otherwise been.”

Part of a long-term development plan

South Africa’s government injected some R33-billion into preparations for the World Cup, which Gordhan said was an investment that formed part of a long-term development plan for the country, rather than funding a once-off event.

“Hosting the 2010 Fifa World Cup acted as a catalyst for expanding our infrastructure base, skills development, employment creation, and economic growth.”

“We must also remind ourselves that what government was able to put into this project came from the taxpayers of this country, both in the business sector and as individuals, and it is to them also that the credit must go,” he said.

Major boost for South Africa’s image

Even more importantly, Gordan said, the tournament had undoubtedly boosted the country’s standing internationally, showcasing its capabilities in delivering world-class infrastructure on time and without imposing a financial burden on the national fiscus.

He said the successful hosting of the tournament had shown that South Africa could rise to the challenge of hosting the biggest single-code sporting event on the planet.

“The narrative about South Africa in the international media during the tournament suggests that we did close that perception gap. Reporting on South Africa has been the most positive since our successful transition to democracy in 1994.

“Importantly, for once, South Africans were more optimistic than anyone else in the world, more confident about their abilities than anyone else in the world, and more united about the experience they were creating for both the world and themselves.”

Three key lessons learnt

Three key lessons were learnt during the hosting of the tournament, Gordhan said. First was the breaking down of complex challenges into a number of clearly defined undertakings with their own budgets and cash-flow.

“The complex 2010 Fifa World Cup project was disaggregated into a mere 24 projects. This enabled all institutions involved to focus on what was required to deliver on time and ultimately ensure a successful event.”

The second lesson learnt was the defining of roles and responsibilities to indicate clearly which organisation was to do what work and by when. The third lesson was the importance of an immovable deadline that all parties had to work towards.

Infrastructure drive continues

“These lessons will be taken forward in our public sector infrastructure programme, where R846-billion has been committed over the next three years. We have budgeted that R261-billion will be spent this financial year, increasing to R300-billion in financial year 2013.”

More than 45 percent of these funds had been committed to South Africa’s electricity, freight rail and ports sectors. The minister said that investing in these sectors would ensure security of supply of electricity and improved quality of freight and shipping services, thus helping to grow the country’s exports, among other things.

“There is also intensive work taking place to formulate a long-term infrastructure investment plan, while the government is also working on different funding options for social and economic infrastructure. Once completed, this plan will ensure that South Africa has a sustained and sustainable infrastructure delivery plan.”

However, the most important legacy of the 2010 Fifa World Cup was “the renewed confidence in ourselves as a nation that the hosting of the tournament has brought about.”