Archive for Friday, July 9, 2010

Country’s woes continue despite World Cup

July 9, 2010

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— South Africa may reap a long-term windfall for defying the skeptics and successfully hosting the World Cup. Short term, however, the profits are heading elsewhere while unions gripe and the nation’s already staggering unemployment rate climbs even higher.

Tournament organizer FIFA is happy with near-record ticket sales and huge global TV audiences. Some of its major international sponsors also are reporting record sales.

Yet official jobless figures released during the tournament revealed that the extensive World Cup-related preparations — including several billion dollars worth of new stadiums and transport infrastructure — didn’t prevent a further economic downturn in South Africa.

According to Statistics SA, 79,000 non-farm jobs were lost in the first quarter of this year, and 242,000 in the 12 months ending in March. The jobless rate is above 25 percent — and more than 30 percent if those who’ve given up job-hunting are included.

“The World Cup took us forward 20 paces. Maybe we’ll go back 10 or 12 paces afterward, but we’ve still got a net gain,” said Lee-Anne Bac, a director of the financial consulting firm Grant Thornton. “We’ve got the momentum and we need to keep it going.”

Short term, there are some clear winners from this World Cup, including FIFA — which estimates it will earn $3.3 billion from marketing, TV rights and other initiatives.

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