Every four years, the FIFA World Cup is an incredible international sporting event. An explosion of culture, passion, color, and energy is brought to the host nation by fans from all over the world. The world game is a wonderful honor for the nation that hosts it, and the event has great potential for global broadcast, tourism, and millions of dollars in economic impact.
The host nation is required by FIFA, the international governing body for soccer (football), to adhere to specific rules and specifications regarding security, transportation, lodging, training facilities, opening and closing ceremonies, marketing, promotions, ticketing, insurance, and other administrative issues.
Is it worth taking financial risks to host such an event? For hosting such an event, infrastructure issues like airports, roads, stadiums, and public transportation are typically among the most significant issues. Athens’ budget increased to US$16 billion in 2004 when it hosted the Olympic Games: Beijing’s 2008 budget increased to approximately $40 billion from US$1.6 billion. The cost of hosting the Olympics in London in 2012 has increased from US$5 billion to approximately US$20 billion. Before the start of the 2010 World Cup, it is estimated that South Africa and FIFA have spent $5 billion and $1.1 billion, respectively, on preparations.
From hosting the FIFA tournament, small businesses, hotels, restaurants, souvenir shops, tours, and transportation could benefit from millions of dollars from tourists. The provision of security for fans and all teams, anti-terrorist activities, policing racial sensitivities, and the purchase and installation of high-tech monitoring equipment, however, are the costs that come with a significant influx of visitors.
If the host nation does not receive the revenue from ticket sales, the cost of hosting such a global event may not be fully recovered for years. The success of hosting the FIFA tournament will be determined by history. In the years to come, the host nation and its local suppliers and industries may gain from this global event’s exposure.
According to a study conducted by a US economist on the historical experience of host nations since 1954, economic growth has been slower in the World Cup year in seven of the 13 tournaments since 1954 than in the two years preceding the event. On the other hand, in the two years following the event, 9 of the 13 host nations since 1954 have demonstrated faster economic growth.
Through competition, the FIFA World Cup brings people from all over the world together, fostering cross-cultural communication and international understanding. The FIFA World Cup fosters universal brotherhood in a world marred by war, racism, and religious intolerance, which has unquantifiable benefits for humanity.
While it is estimated that 26 billion people will watch the FIFA World Cup, only 6 billion people will watch the Olympics.
In June and July, South Africa will host the FIFA World Cup 2010. The following FIFA World Cup will be held in June to July 2014 in Brazil, a country who was delegated the title holders in 1958, 1962, 1970, 1994, and 2002.