Cup can boost economy

2017-09-13 06:02

Amazing economic benefits are expected if the country wins the bid to host the 2023 Rugby World Cup.

South Africa’s economy is expected to be boosted by R27,3 billion in terms of intangible benefits that will accrue to the country if the deal materialises.

Research results were revealed by Grant Thornton based on the economic impact assessment commissioned by SA Rugby.

The economy is expected to undergo a definite enhancement through increasing tourism before and after the tournament, and the cohesion and national pride that will result from hosting a major international sporting event.

The deal will further sustain 38 600 annual, temporary and permanent job opportunities.

The report is apparently being independently verified by the South African government’s insistence before it provided the financial guarantees to underwrite the bid.

Other highlights from the report show that hosting the tournament will generate R11 billion in direct spend in South Africa and R1,4 billion in tax revenue. Low-income households will benefit by an amount of R5,7 billion.

Thornton’s team carried out numerous interviews and surveys to determine the costs of hosting the tournament in conducting the assessment. Other data that was scrutinised include economic impact studies from previous Rugby World Cup events, rugby tournaments and internationals held in South Africa, as well as other large sports events hosted here in the past.

The results are expressed as direct, indirect and induced impact. For example, direct impact will be the amount that a guest pays for a hotel room. Indirect impact is what the hotel spends buying food for guests during the tournament, while induced impact will be the amount that the hotel’s employees spend in local shops as a result of their employment with the hotel.

SA Rugby CEO, Jurie Roux, says the assessment was rigorous. He says the assumptions are based on best practice. Government thoroughly scrutinised the determinations before committing to the financial guarantees.

“There would have been no guarantee of R2,7 billion if government was not convinced that hosting the 2023 Rugby World Cup was an economic opportunity as well as a sporting occasion.”

An important consideration is that the economic impact will be shared across the seven host cities. With the most matches and the final, Johannesburg will benefit by an amount of R10 billion with 14 102 jobs created or sustained. The contribution to Cape Town’s gross domestic product (GDP) will be R5,2 billion with 7 304 jobs.

The impact on the remaining five host cities (Durban, Tshwane, Bloemfontein, Nelson Mandela Bay and Mbombela) is between R1,4 and R4,5 billion.

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