Stunning spectacle or economic boom – What are the benefits of hosting a global sporting event?
The 2014 World Cup started yesterday in Brazil with a fanfare of music, colours and carnival. The home nation then emerged to play the opening game, from which they delivered a crowd pleasing comeback to beat the plucky Croatians.
It was a showcase of what the event that brings the whole world together is about. As England prepare for their opening game in Manaus, they will have been reminded that the last time a sporting event had united nations to the same extent was on their home soil.
However, another thing that the 2012 Olympic Games in London and the 2014 World Cup in Brazil will have in the common is that they will both have been very very expensive. And when the dust settles in Brazil, the question will be, as it was here in England, was it worth it?
The cost of London 2012 eventually totalled around £9 billion and a BBC poll revealed that over two-thirds of the British public believed the Games were worth the cost.
On the economic, business and investment side of things however, the opinion was a little more divided. There were widespread reports that small businesses had taken a real hit during the Olympics, with some reporting they had seen none of the benefits of the ‘Olympic effect’.
The Guardian reported a similarly polarized view, with the debate interchanging between the lack of opportunity for small business and the long lasting impact the Games will have on future investment.
In July 2013, the BBC revealed that the Olympics had led to a £9.9 billion increase in trade and investment in the UK. Already near a million more than the total spend. What’s more, it was also revealed that around 2000 UK companies supplied the games directly and that the event had led to £2.5 billion worth of investment outside of London.
The real legacy of the Games for business and development may yet still have to come into fruition. The Queen Elizabeth Olympic Park opened in April 2014 and is part of the aim to rejuvenate the heart of East London. It is hoped the area will become a hub for new homes, schools and businesses.
Overall, it seems that the London Olympics were able to offset the costs of hosting the Games and the future benefits for the UK are still being felt two years on. Not only did the Games attract global appraisal, but also provided opportunities for new and existing businesses alike to grow.
With Brazil now firmly in the spotlight, it remains to be seen whether this World Cup will have the same positive effect on growth and investment as the London Olympics. Especially considering the protests that have already begun to taint the tournaments opening days.
There are many ways to gauge the success of a sporting event, depending on what you are looking for, whether it is a great competition, a stunning spectacle, or to make more money than you had at the start of it. In ideal world, it would be all three.
How was your business affected by the London 2012 Olympics? Let us know by leaving a comment below.
Interested in more news and comment from NovaLoca? See our trip to the World Cup themed IAS Barbecue, or read our blog on advantages and disadvantages of buying or leasing commercial property.