“The idea is that Brazil gets organized in such a way that the event lasts not only a few days, but for many years, leaving a positive legacy for society as a whole”.
Ernst & Young Terco.
Brazil, the largest and most populous country in Latin America, with some estimated 199million people, is the worlds’ fifth country in area and population. Being a key member of the G20 economies and one of the developing countries referred by financial analysts of emerging markets as the “BRIC” (Brazil, Russia, India, and China), Brazil has experienced progress in her struggle for a more meaningful development. Owing to over two “lost decades” for development due to military rule, brazil through early, but with late resumed growth (in 2004), has made economic and social progress. The economy has been booming in part due to commodity exports to china, including soya bean and steel. As much as this persists, Brazil has been cited as an example of a country that has experienced “growth without development”, indicators for development in Brazil lagged, and eventually undermining growth prospects.
From racial disparities, unjust treatment of indigenous people, lack of access of the poor to fertile land, extreme inequality, high rates of poverty, to high borrowing costs, and ranking 85th on the UNDP human development index, with over seven (7) million children as victims of child labour, Brazil continues to grow her economy amidst extractive economic, political and social institutions.
Despite developmental challenges, Brazil has been given the opportunity to host the greatest sporting event ever – THE FIFA WORLD CUP. The world cup has become a major event the world excitedly anticipates. As we draw nearer to its kickoff game, we must understand that as much as the excitements, intrigues, actions and suspense keep the world glued to her television sets; we must also understand the impact of such event on the host county and global economy.
Ernst & Young Terco and the Fundacao Getulio Vargas (FGV), in their recent study observed that the 2014 world cup will produce a cascading effect on investments made in the country. The economy will snowball, increasing by five times the total amount invested directly in event-related activities and impacting various industries. In addition to the R$22.46billion spent by Brazil on the world cup to ensure adequate infrastructure and organization. The tournament would bring an additional R$112.79billion to the Brazilian economy. Also expected between 2010 and 2014, is the generation of 3.63 million temporary jobs and R$63.48billion of income for the population, which will inevitably impact the consumer market and also R$18.13billion in tax collections.
The Ministry of Tourism in Brazil, revealed, that an average of 3.7million persons were expected to travel to Brazil. He noted that the average tourist will attend four matches and spend approximately $2,488 during her stay. Brazilian president pointed to a 49% jump in the sales of television. Furthermore Pew Research Centre found 72% of Brazilians’ were “dissatisfied with the way things were going in the country” and 61% said they thought hosting the world cup “was a bad thing”, because it took money away from schools, health care and public services. Recently, public servants have staged indefinite strike, along with university protests. Also, more than four million commuters have been left without transportation.
In Nigeria the sport loving most populous African county, the world cup leads to increased sales of sport newspapers, generating sets, traffic congestions, queues at filling stations etc. More generally the world cup has globally increased budgetary end extra budgetary expenses of governments in sponsoring her teams, and automatically, increased world GDP.