New Deloitte Research: Hosting of World Cup Represents Economic Turning Point for South Africa

New York, June 17, 2010—With the kick off of the 2010 FIFA World Cup in South Africa, the international community is not only watching the action on the pitch; they are also witnessing a South Africa that continues to emerge as a competitive 21st century economy. As outlined in Deloitte’s paper "2010 FIFA World Cup. A Turning Point for South Africa," South Africa is reaping the rewards of hosting the Cup, including infrastructure improvements, an economic boost, and an increase of national pride.

"South Africa has been likened to a mix of the developed and developing world," said Lwazi Bam, Public Sector Industry Leader, Deloitte Southern Africa. "On the one hand, a strong technological and economic base put it on a par with the well-developed nations of the world. On the other, infrastructure shortfalls have contributed to keeping it from realizing its full economic potential. This major global event is a catalyst for much-needed infrastructure improvements."

The need to move tens of thousands of fans, teams, and accompanying support personnel rapidly from one place to another prioritized the strengthening of South Africa's transportation system. The country completed much of the first section of its new high speed Gautrain passenger railway and added bus lines. Highways were upgraded and the city of Durban was able to finish the country’s first new green field airport in five decades. These infrastructure projects have increased employment opportunities and provided workers long-term skills and training.

"South Africa has already realized many of the benefits hoped for by any national host of a major international sporting event," said Greg Pellegrino, Global Public Sector Industry Leader, Deloitte Touche Tohmatsu. "The event has provided a boost to national infrastructure improvements, increased employment during the global financial crisis, and provided a unifying rallying point for a still-developing nation."

One of the challenges in building the infrastructure for the event was generating power without an unduly adverse environmental impact. New stadium facilities include such environmentally-friendly features as natural ventilation and rain water capture systems. In addition, host cities have undertaken large-scale tree-planting projects in an effort to soak up excess carbon dioxide. As a coal-dependent economy, South African faces challenges; however, these steps move the country toward greener energy sources.

To ensure security, the minister of police has consulted with officials from more than 30 different countries whose nationals are in the country, resulting in an unprecedented level of international cooperation. Seeking to balance a welcoming atmosphere with rigorous security standards, 40,000 police officers, 25 percent of the country’s total force, have been assigned to the Cup. All of these activities have required a renewed spirit of cooperation between national and local agencies and departments.

"Moving the FIFA World Cup from a developed economy such as Germany, to an emerging economy such as South Africa, and to a continent that has never hosted the Cup, creates an important precedent for future hosts such as Brazil in 2014," concluded Pellegrino.

For more information contact: www.deloitte.com

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