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SBD Global/August 26, 2013/Finance

Legacy Fears Cloud Preparations Ahead Of 2014 World Cup In Brazil

When Brazil was awarded the right to host the 2014 World Cup, the country's then Sports Minister "promised that not a penny of taxpayers' money would be spent on building and refurbishing stadiums," according to Andrew Downie of AL JAZEERA. However, with only half of the venues ready, "spending on their construction stand at around" 7.6B reais ($3.2B), roughly three times the original estimate. The vast majority of that cash "has come from public coffers." Brazil "is expected to eventually spend close to" $12B to host the world's premier sporting event. Rio-based U.S. professor of architecture and urban planning Christopher Gaffney said, "It's a big farce. The only people benefitting from this are the big construction companies." One result has been an outlay of $215M to build a 44,000-seat stadium in Manaus, a city whose biggest local football team "has average gates of less than 1,000 people." And Manaus "is not the only such case." The federal government’s own audits court found that "at least four of the 12 arenas are likely to be white elephants once the tournament is over." The government claims the stadiums "will drive development in the surrounding communites." Sports marketing consultant Amir Somoggi, who works with some of Brazil's biggest clubs, said, "This public financing of Pharaonic works is not at all financially viable. We made a big mistake and our money is being thrown away." The situation with the legacy infrastructure "is even more troubling." With 40 million people having been lifted out of poverty since the turn of the century, the country "needs more airports, ports, highways, and public transport networks to cope with that massive growth spurt" (AL JAZEERA, 8/24).
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