World Cup Cost

The 2010 FIFA World Cup has hit South Africa in a big way. Everybody, from fans to vendors, from hotel staff to the players themselves, is looking forward to a good time. But just how much is it costing South Africa to host the World Cup?

Infrastructure

Overall, South Africa has invested R30bn-plus in the event. This includes building and redeveloping ten stadiums, creating a new transport infrastructure, and ensuring security arrangements are in place. 

FIFA has budgeted to spend R7.83bn on the World Cup, on organisational overheads, television production and prize money. In May, it added an extra R750 million to the costs, to ensure that team training camps would be ready in time.

Gillian Saunders, who has researched the finances of the 2010 World Cup for accountant Grant Thornton, said expenditure on the event represented only 1.72 per cent of South Africa's gross domestic product.

Who scores?

The question asked is, what do FIFA, the South African Local Organising Committee (LOC) and the SA Football Association (SAFA) score out of the World Cup? 

In 2007, LOC CEO Danny Jordaan said that FIFA had by then signed 2010 World Cup contracts worth R23.2bn – the highest yet for a World Cup – and that the figure could grow to between R35 and 40bn.

A FIFA spokesperson has since confirmed the revenue, saying it was derived from the sale of television rights, marketing rights, hospitality rights and licensing. With the FIFA budget at R7.83bn for the World Cup, the contracts already signed will win it a whopping R15.37bn operational profit for the South African World Cup. If more rights are sold, FIFA could get significantly more.

The LOC has to pay R3.07bn for its own overheads and participating teams’ expenses, of which some is funded from ticket revenue and the rest from FIFA. Any further ticket revenue – an early estimate is another R1.09bn – will be split between FIFA and the LOC. Once the LOC closes its books, any surplus will accrue to SAFA.

Although the LOC is not an ultimate beneficiary, it would have had around R3.5bn flowing through its coffers. 

But the biggest winner is FIFA, with a minimum profit of R15bn. This will be used to sustain the association until the next World Cup and build reserves.

For South Africa, the investment of R30bn-plus will bring a direct return of a few hundred million rands in stadium rentals. It is hoped that a spin-off in terms of tourism will prove beneficial in the long run.

Find out how much the Winners and Players will get at the World Cup!