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HOSTING MAJOR GLOBAL SPORTING EVENTS SERVES AS CATALYST TO IMPROVE NATIONAL ECONOMIC COMPETITIVENESS

Events such as the Olympics and FIFA World Cup are appealing to emerging markets as a way to build global recognition and influence

Hosting major sporting and entertainment events, such as the Olympic and Paralympic Games, FIFA World Cup, and World’s Fair, is becoming increasingly attractive to emerging markets. Historically pursued by developed nations around the world, such events can elevate the host country or city’s global stature and accelerate its economic, political, and social development, according to the Deloitte report “A Lasting Legacy: How major events can drive positive change for host communities and economies”.

“Emerging countries and cities are seeking to distinguish themselves in the new economy by hosting major events to put themselves front and center on the global stage,” said Greg Pellegrino, DTT, Global Public Sector Industry Leader, and co-author of the report. “The rigid deadlines, political champions, and community support accelerate development and expedite change that normally takes decades. Major events can boost tourism, improve infrastructure, and provide an opportunity to elevate the host’s stature among the top global brands in the Fortune 500.”

The report shows that hosting a global event is becoming a top agenda item for governments around the world because it allows a city or country to move quickly and decisively on a wide range of issues and activities that would normally be mired in long debates and bureaucracy. And, with a global audience watching, the event host is encouraged to deliver a high-caliber service.

“Hosting global sports events could also be profitable for small countries such as the Czech Republic or Slovakia, even though the Olympics are not yet in sight. Events like the hockey world championship (2004 in CR, 2011 in Slovakia) markedly contribute to: the visibility of the country abroad, the expansion of infrastructure, support of sports and the development of tourism,” said Marián Hudák, Deloitte’s lead partner for the public sector in the Czech Republic and Slovakia.

The report also puts forward that in addition to economic and social development, staging a global event also produces fringe benefits that can be transformational in the long term. It fosters collaboration among the public and private sectors and the general public. It breaks down barriers between political parties at various levels of government (national, regional and local). It also improves government efficiency and sets an example for new ideas and behaviours such as environmental sustainability, diversity, and community involvement.

Here are some examples of the positive effect of global events:

Better Position in Global Business
Olympic Games in Beijing in 2008 – China strengthened its position as an economic power. The attention of the public helped attract new investments.

Increase in Attractiveness of Travel
2006 World Championship in Germany – by using the Championship’s theme “It’s time to be friends” friendliness was added to the traditional German image of reliability and technological development.

Development of Infrastructure
Olympic Games in Munich in 1972 – triggered fast construction of the subway, in normal conditions the construction would take 10 to 15 years, but thanks to the Olympic Games the construction was accelerated and finished in five years.

Long-Term Positive Effect on the Economy
Olympic Games in Barcelona in 1992 – several global infrastructure projects (transport, telecommunications) and overall renovation of city suburbs stoked the lasting interest of companies and tourists.

Positive Influence on Politics and Stability
Brazil – President Luiz da Silva is enjoying increased popularity after his country successfully hosted the Pan-American Games in 2007 and was selected to host the 2014 Football  Championship and the 2016 Summer Olympic Games.

More Collaboration Between the Public and Private Sector
Olympic Games in Sydney in 2000 – a good example of the collaboration of the organisation committee, the public, companies and governmental agencies on national, regional and local levels.

More Effective Government
Olympic Games in London in 2012 – the city government and five municipalities work together via an integrated plan for preparing the Olympic park, coordinating time procedures and concluding multilateral agreements.

Rising Self-Esteem
Olympic Games in Barcelona in 1992 – Barcelona managed to differentiate itself from Madrid which was a very positive development for the Catalonians.

Better Quality of Life
Olympic Games in London in 2012 –one of the main objectives is to use this event to speed up the development of a new economic centre in the eastern part of the city and enable it ongoing expansion.

New Approach to Incentives
Olympic Games in 2010 in Vancouver – the organisers asked visitors to purchase carbon offsets for the estimated 268,000 tonnes of emissions the games will produce. Almost half of that carbon footprint will be generated by spectators.

More competition
As major events grow in economic influence, more cities and countries want to host them. Organizations like the International Olympic Committee (IOC) and the International Federation of Association Football (FIFA) are interested in expanding their global reach by holding events in emerging countries. Accordingly, the heightened competition in winning the bid risks creating a spiral of increasingly ambitious plans and claims from aspiring hosts, particularly emerging cities and countries that feel a stronger need to impress the selection committees.

More investment on security
The report also shows that security is rapidly becoming a more and more relevant issue in evaluating bids to host events. Growing in visibility, these events have become targets for disruptive forces. The range of security threats has expanded to include large-scale bombings, global pandemics, biological weapons, and cyber attacks, and host countries and cities must increase their investments in security measures.

To read the full report, visit www.deloitte.com/lastinglegacy