How much money would South Africa make from hosting the 2023 Rugby World Cup?
Hosting the Rugby World Cup in 2023 will bring South Africa R27.3 billion in direct, indirect and induced economic impact, according to a Grant Thornton economic impact assessment commissioned by SA Rugby as part of the bid process.
The competition will also sustain 38,600 annual job equivalents – some temporary and some permanent, Grant Thornton said.
SA Rugby delivered its bid to host the 2023 rugby showcase in Dublin, Ireland in May. The country is up against Ireland and France for the hosting rights with the winner to be announced on 15 November.
At the South African Government’s insistence, the report was independently verified before it provided the financial guarantees to underwrite the bid.
Other highlights from the report show that hosting the tournament will generate R11 billion in direct spend in South Africa and R1.4 billion in tax revenue.
Low-income households will benefit by an amount of R5.7 billion, the report found.
In conducting the assessment, Grant Thornton said its team carried out numerous interviews and surveys to determine the costs of hosting the tournament.
Other data that was scrutinised included economic impact studies from previous Rugby World Cup events, rugby tournaments and internationals held in South Africa as well as other large sports events hosted here in the past.
The results are expressed as direct, indirect and induced impact. For example, direct impact will be the amount that a guest pays for a hotel room.
Indirect impact is what the hotel spends buying food for guests during the tournament, while induced impact will be the amounts that the hotel’s employees spend in local shops as a result of their employment with the hotel.
An important consideration is that the economic impact will be shared across the seven host cities. With the most matches and the final, Johannesburg will benefit by an amount of R10 billion with 14,102 jobs created or sustained.
The contribution to Cape Town’s GDP will be R5.2 billion with 7,304 jobs.
The economic impact for the remaining five host cities – Durban, Tshwane, Bloemfontein, Nelson Mandela Bay and Mbombela – is between R1.4 and R4.5 billion.
Read: Why Durban lost the Commonwealth Games 2022
In addition to the tangible economic impact, the report also lists a number of intangible benefits that will accrue to the country.
These include enhancing South Africa’s international profile, increased tourism before and after the tournament, and the cohesion and national pride that results from hosting a major international sporting event.
Notably, the report states that no additional stadia will need to be built and that successfully hosting the event will generate interest to host other global events in South Africa in future.
“The resulting economic impact assessment shows that the 2023 Rugby World Cup will provide significant economic benefits to the local economy in respect of jobs sustained, gross geographic product and taxation,” Grant Thornton said.
The 2009 British & Irish Lions tour to South Africa boosted the local economy by as much as R1.5 billion over a six week period, thanks to the deep pockets of of 37,000 visitors from Britain and Ireland.
An evaluation of the Football World Cup hosted by South Africa in 2010 showed that the country spent R55.3 billion (R22.9 billion of which was on stadia and related infrastructure).
The total impact on South Africa’s economy (direct and indirect) was estimated to be R93 billion with 63% spent before the event took place.
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