Game on Mega-event infrastructure opportunities
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Game on
Mega-event infrastructure opportunities
April 2011
At a glance
The quality of a region’s
infrastructure denotes
its potential for growth
well into the future.
Investment in
mega-event-related
infrastructure can
accelerate economic
development by as
much as three decades.
Cities and regions
turn to public-private
partnerships for
access to capital
and risk mitigation.
The transformative effect of well-thought-out supporting infrastructure for a
mega-event like the Olympics or World Cup football has long-lasting economic,
demographic, and social implications for the entire region. How a government
body—national, regional, or municipal—plans for the legacy of supporting
infrastructure can have a ripple effect on the development of a region for
decades to come.
More than 4 billion people worldwide Today, winners of mega-event bids
tuned in to the Beijing Olympics should begin planning far ahead of
in August 2008, the largest global the actual event, often a decade or
television audience on record. A lavish longer in advance, recognizing that
extravaganza that cost billions of success in hosting a mega-event must
dollars, the Beijing Games were the include the supporting infrastructure
most expensive to date. And while required for participation, by both
the world watched, China took center athletes and spectators. In fact,
stage. The global audience tuned in to inadequate infrastructure planning or
watch athletes compete, but they also follow-through might well upend the
saw contemporary China in a whole perception of impressive achievement:
new light. This opportunity to capture Reports documenting the potential
the world’s attention for a few weeks— lack of adequate infrastructure have
and the ensuing lasting legacy— sometimes dominated the news in
exemplifies both the intangible and the the weeks and months leading up to
tangible essence of mega-events. a mega-event. Those reports have the
potential to jeopardize the positive image
Indeed, the legacy of a mega-event is a city or country is aiming to build. To
very tangible: An October 2009 report avoid such a scenario, advance planning
by two economists, Mark Spiegel is essential. So is the importance of
from the Federal Reserve Bank of San demonstrating the lasting benefit of
Francisco and Andrew Rose from the that infrastructure investment, a true
University of California, Berkeley, legacy for the community.
found that hosting a mega-event
like the Olympics or the FIFA World In the excitement that grips a host
CupTM permanently boosts trade by 30 city immediately after a selection
percent. Their study of 196 countries’ announcement, ideas and vision
economic performance between 1950 abound. Translating those ideas and
and 2006 found that the “Olympic that vision into reality, however, is
effect” derives from host countries more elusive. To maintain clarity of
signaling their intention of moving vision, city leaders are well advised
toward a more open trade policy.1 to test the long-term viability of each
2 PwC Game on: Mega-event infrastructure opportunities
anticipated project. How does the Taking the long view plans for the legacy of supporting
vision for mega-event investment infrastructure can have a ripple
Providing adequate transportation,
correspond with the region’s long-term effect on the development of a
utilities, clean water, and sanitation
needs and objectives? Which financing region for decades to come.
for thousands of athletes and millions
models best apply in each case? What
of spectators at a mega-event like the In Spain, Barcelona used the 1992
role does sustainability play? What are
Olympics or the World Cup, governed Olympics as a catalyst to speed
the projected maintenance costs? How
by the Fédération Internationale up previously established goals
will procurement occur? What kind of
de Football Association (FIFA), is for urban regeneration. The city
oversight should govern the process?
no mean task. But what becomes constructed ring roads that eased
PwC understands each of these critical
of that supporting infrastructure long-term traffic congestion, renovated
success factors and barriers. In the
after the athletes and spectators its airport, restructured public
following pages, we will analyze the
have gone home? While the eyes transportation, improved public
infrastructure investments that a sample
of the world are on the events, parks and the lakefront, upgraded
of host cities has made. We will also
athletes, and facilities for a few its telecommunications system, and
examine the long-term implications for
weeks during a mega-event, the modernized its sanitation system.
each region where those investments
transformative effect of well-thought- With every intention of benefiting
occurred. Our experience advising
out supporting infrastructure has the residents and businesses of
organizing committees, contractors, and
long-lasting economic, demographic, Barcelona over the long term,
host countries allows us to discern—
and social implications for the entire local planners undertook a massive
from the perspective of an infrastructure
region. How a government body— effort to transform the city.2
investment—the factors that create a
national, regional, or municipal—
lasting legacy for a host city or country.
3
But the Games weren’t the sole catalyst However, public support—and
for this evolution, according to Stephen resources—are not always enough.
Essex, associate professor at the UK’s Private funding, expertise, and
University of Plymouth, who researches oversight are often required to
infrastructure implications of the bridge the gap between what
Olympic Games. He says the Olympics the public sector can realistically
“simply speeded up the renewal that achieve and what the mega-event
had already been planned to take place actually requires. In addition to
over 50 years” in keeping with the almost $5 billion committed by
region’s 1976 General Metropolitan the public sector, the Barcelona
Plan of Barcelona. According to Essex, Olympics attracted some $7 billion
organizers had already “mobilized public
250%
support through neighborhood projects
that had established a consensus for
change.” Meanwhile, existing facilities
with planned upgrades served as many
of the main Olympic venues. And
public sector support was substantial, In anticipation of increased consumption during
Essex says, impelled by the end of the the 2014 Winter Olympics in Sochi, 200 new facilities
Franco period as well as an upsurge in
regional identity.3
will power up incrementally, increasing the energy
capacity of the Sochi power grid by 250 percent.
In fact, Barcelona spent six times
as much on infrastructure (both
Games infrastructure and supporting in private-sector financing.6 Today,
infrastructure) as it did on organizing municipalities hosting the Olympics
the event itself. And four previously and other major events like the
neglected urban areas were a part of World Cup increasingly explore
the plan for citywide Olympic facilities, private-sector options as a way to
which allowed city planners to better manage financing concerns
allocate resources for comprehensive for supporting infrastructure.
redevelopment.4 As a result, the More recently, some cities and
1992 Games thrust Barcelona into regions have turned to public-
the top tier of Europe’s tourist and private partnerships (PPPs) as
business destinations; the mayor of a viable solution. Best suited to
Barcelona said the city experienced large-scale infrastructure assets
a metamorphosis within five years with ongoing maintenance
that would otherwise have taken requirements, PPPs are increasingly
three decades.5 In fact, thanks to used to secure additional financing,
infrastructure investment and brand better manage risk, and increase
equity in the wake of the Olympics, transparency and accountability.
tourism revenues more than doubled (For more on PPPs, see page 15.)
in Barcelona.
4 PwC Game on: Mega-event infrastructure opportunities
A 2010 World Economic Forum report found
that underinvestment in infrastructure is a top
10 economic risk for the entire global landscape
because infrastructure is the foundation of a
region’s prosperity and resilience.
Investing for long-term economic benefit.10 Post-
optimum return Games, Beijing is a top performer in
the infrastructure category, according
While the total amount invested in
to a 2010 PwC report on global cities.
a mega-event is always high, it can
Despite lingering urban mobility
vary widely, based on how much
challenges, it has the lowest user
infrastructure already exists. China
cost of public transportation of
invested approximately $40 billion in
the 21 cities evaluated.11
infrastructure alone between 2002
and 2006 to prepare for the Olympics, London, meanwhile, expects to spend
building some 40 new stadia and some $15 billion for the Olympic Park
athletic facilities, doubling the capacity under construction in East London
of Beijing’s subway system, completing and the regeneration of the entire
the light-rail system, building and region, including transportation,
improving roads, and constructing bridges, utilities, and walkways.
a new airport.7 Olympic-related Olympic Village, which will house
investment accounted for up to 15 the athletes during the Games, will
percent of overall economic investment provide private as well as government-
between 2002 and 2008.8 What the supported housing for London
city gained was an enormous—and residents after the Games. A report
enormously overdue—investment from the UK’s National Audit Office
in its basic infrastructure and in its says that “Olympic Park will be a
public spaces, according to William blueprint for sustainable living and
Kirby, director of the Fairbank Center help to transform the heart of East
for Chinese Studies at Harvard London,” historically a less developed
University. Kirby describes the new part of the city.12 Meanwhile, several
airport as “stunning, larger than all long-term transportation projects
of Heathrow, and perhaps the most estimated at about $8 billion, while
beautiful on earth”.9 And by easing air not being delivered specifically for the
traffic congestion as a result of fewer Olympics are nevertheless essential for
flight delays, the airport also provides the success of the Games, according
5The mayor of Barcelona said the city experienced a metamorphosis
within five years of the 1992 Olympics that would otherwise have
taken three decades.
to the National Audit Office report. to cost $20 billion—that would
These projects include widening of the serve both the Olympics and the
M25 motorway around London and World Cup.17 Private investors from
upgrading rail links to Olympic venues, the Middle East, Europe, and the
such as the West Coast mainline and US have expressed interest in these
the Channel Tunnel Rail Link. The infrastructure projects. Even more
M25—the second longest ring road in pressing is the need to upgrade
Europe at 117 miles—was procured Brazil’s airports. Increased capacity
as a PPP and financed entirely with is essential for handling the volume
private funding.13, 14 of foreign visitors expected to attend
both mega-events; public-private
New opportunities partnerships offer an ideal option
for investors for airport development.
Investing in infrastructure offers a
Meanwhile, in Sochi, Russia, site
multitude of economic and social
of the 2014 Winter Olympics, the
benefits to the region itself. It also
Russian government is actively
offers a wealth of opportunity to
soliciting participation in public-
international investors seeking new
private partnerships. City and
markets. Brazil, for example, is
regional planners expect the Games
expected to invest some $83 billion
to transform both Sochi and the
in infrastructure from 2009 to 2016
Krasnodar region in southern Russia,
to prepare for World Cup football in
1,000 miles south of Moscow, into
2014 and the Olympics in 2016. More
a state-of-the-art year-round resort—
than 1,200 projects have already
with more than 220 miles of roads
been identified for the World Cup,
and bridges, some 125 miles of
which is expected to draw 3 million
railroad track, 22 tunnels,
Brazilians and 600,000 international
telecommunications upgrades,
visitors.15, 16 New infrastructure projects
almost 300 miles of gas pipeline,
will include airports, roads, public
and a modern international airport.18
transportation, and sanitation. A
public-private partnership is likely The Sochi Olympic bid calls for
among the best options to finance approximately 50 infrastructure
a high-speed train line—estimated projects in all. A new high-speed
6 PwC Game on: Mega-event infrastructure opportunitiesrailroad will be able to transport businesses long after the 2014
8,500 passengers per hour, moving Winter Games.19 Already a regional
passengers between the coast and the tourist destination, Sochi is poised
mountains in less than 40 minutes. to evolve into an international
Some 200 new power plants are tourist destination after the
slated to increase the energy capacity Olympics.
of the Sochi power grid by 2.5 times
its existing capacity. They will power Russia is also planning ahead for 16
up incrementally, in anticipation stadia across 13 cities in anticipation
of increased energy consumption. of World Cup football in 2018.
And $500 million worth of new Much of the massive infrastructure
telecommunications infrastructure investment required for this
will allow digital transmission and event—4,800 miles of roadway
mobile communication. City and and 1,200 miles of railroad—will
regional officials have thus planned occur outside Russia’s main cities
for transportation, energy, and of Moscow and St. Petersburg,
telecommunications infrastructure where almost none of the
that will benefit residents and local infrastructure currently exists.
7Infrastructure investment: What works best?
Some mega-event host cities have done a far better job of investing
prudently in infrastructure than others. Below are some of the
priorities that ensure a lasting legacy:
1. Supporting infrastructure works 5. Public-private partnerships
best when it is part of the region’s offer additional financing
long-term plan for growth. options, specialized expertise,
Barcelona already had a 50- and risk transfer, as in the case
year development plan in place; of the Canada Line rapid
Vancouver’s transit project, transport system and Whistler
Canada Line, had been part Highway expansion in Vancouver
of the region’s long-term plan as well as the M25 motorway
for decades. expansion in London.
2. Urban regeneration offers 6. Public-sector commitment
long-term payoffs. Sydney’s to long-term partnerships is
Wentworth Point, formerly essential. In the case of the
known as Homebush Bay, used M25 expansion, for example,
to be a 3-square-mile area of when private financing became
unusable swampland with meat- less certain, the UK’s Department
packing facilities, some industrial of Transport committed up to
facilities, and a munitions $790 million to save the project.
dump before the 2000 Olympics In the end, private funds financed
transformed it into a thriving the entire endeavor; however,
residential neighborhood.a public-sector commitment was
essential to success.b
3. A holistic approach translates
vision into reality: Well- 7. Collaboration among various
thought-out project definition levels of government—federal,
objectives, transparent control state, and local—is essential
and accountability, structured to mega-event infrastructure
project oversight, a clearly planning and investment. Rio
defined time line, and robust de Janeiro won the bid to host
communication and reporting the 2016 Olympics only after
help ensure successful all three levels of government
completion of these large-scale collectively committed the
infrastructure projects. necessary resources. Having
learned from two unsuccessful
4. Legacy planning for stadia, attempts, they worked
especially large venues, is crucial. together the third time to
Qatar, for example, plans to meet the International
build modular venues for World Olympic Committee’s
Cup 2022, then dismantle them infrastructure requirements
post-event and ship them to for a successful bid.
developing nations.
8 PwC Game on: Mega-event infrastructure opportunitiesAs with all mega-events, the new airport with a longer runway
challenges in Russia include for larger airplanes is the country’s
securing funding, attracting private first new airfield in almost 100 years.
investors, completing construction The World Cup also accelerated
on time, and ensuring proper initial completion of the country’s
planning for legacy use. first high-speed rail system. The
50-mile rail line linking Johannesburg
Like the Russian government, the to Pretoria is one of the country’s
South African government actively largest infrastructure projects,
solicited private participation in according to South Africa’s
infrastructure, specifically foreign Department of Transport.20
direct investment. The government
provided incentives for foreign
To prepare for the 2010 World Cup, the South African government committed
a first tranche of $52 billion toward energy generation and distribution,
rail transportation, and ports.
companies to partner with local Infrastructure
businesses. While wider infrastructure investment offers
development has long been a goal competitive advantage
of the South African government,
the 2010 World Cup—the first sports A lasting mega-event legacy,
mega-event held on the African infrastructure provides the economic
continent—accelerated much of the and social foundation of a region’s
planning and development. prosperity: Workers spend less time
In fact, the government embarked getting to and from work, businesses
on an ambitious infrastructure move products and supplies more
development undertaking in 2008, quickly, and transportation costs
committing a first tranche of $52 decrease. A 2010 PwC report found
billion toward energy generation that infrastructure correlates directly
and distribution, rail transportation, with a region’s “livability,” which is
and ports. In preparation for the an economic asset.21 In fact, the
World Cup, the government invested quality of a region’s infrastructure
more than $4 billion on infrastructure, indicates its potential for growth
implementing extensive road, rail, well into the future. In the context
and airport upgrades. And a brand of a mega-event, selection committees
9The monorail project in Manaus, in anticipation
of World Cup 2014, is one of Brazil’s most
ambitious urban mobility projects to date,
an excellent example of how a mega-event
can impel regional long-term infrastructure
investment.
look carefully at infrastructure climate change, urbanization,
from a more practical perspective. and growing congestion.22
They want to be sure that the city
can accommodate the athletes Legacy planning was certainly a
and spectators during the actual consideration in the Sydney Olympics,
event—house and transport as evidenced by analysis from the
them—while the mega-event New South Wales Treasury’s Office
itself functions smoothly. of Financial Management, which
identified the development of major
The task of looking beyond facilities and infrastructure as a
the actual event becomes the driver of business benefit well
responsibility of the host city, in advance of the 2000 Sydney
region, and country. Legacy Olympics.23 In the post-Games
planning has become a major assessment, PwC reported that
component of hosting a mega- the public and private sectors in
event, not least because of the Sydney invested some $2 billion
long-term competitive advantage on the construction of venues and
that infrastructure offers. And infrastructure built specifically for
global demand for infrastructure the Games. In addition, regional
will continue to expand significantly infrastructure construction completed
in the decades ahead, according in time for the Olympics but not
to the Organization for Economic undertaken specifically for the
Cooperation and Development Games amounted to another $2
(OECD), driven by global economic billion or so. New construction and
growth, technological progress, upgrades included refurbishing
10 PwC Game on: Mega-event infrastructure opportunitiesthe Sydney airport, building new
expressways, upgrading several
railway stations, and improving
the sanitation system.
The upgrade of the Sydney airport,
which cost approximately $1.5
billion, almost doubled its capacity
to handle international passengers
and added a new rail link. The
local telecommunications operator
upgraded its capacity at a cost of
several billion dollars, which allowed
for more than 500,000 mobile
telephone calls in Olympic Park
during the opening ceremony, a
record-setting number in the year
2000 at one event.24 Today, Sydney
ranks as a top performer in PwC’s
2010 report on global cities. The city
leads in business, political, and quality-
of-life variables ranging from urban
livability to housing, green space,
air quality, congestion management,
and carbon footprint.25
11A mega-event can advance that an entire decade.26 In Atlanta, represent a reversal of the 1970s sometimes elusive economic asset dormitories built to house athletes and 1980s population trend, when of livability, often by a decade or at the 1996 Olympics now house some 100,000 residents moved to more, as proven by Barcelona. 10,000 university students. Meanwhile, the suburbs.27, 28 And a 21-acre And Munich’s acceleration of the conversion of commercial space section on the edge of downtown transportation and infrastructure to residential has attracted more Atlanta, previously a blighted projects in preparation for the 1972 than 100,000 new residents to the industrial district, is now among Games allowed the city to hasten downtown area since the year the largest urban green spaces urban development by as much as 2000. These newer residents in the US.29 12 PwC Game on: Mega-event infrastructure opportunities
Poised for transformation Russia, South Africa, and Brazil. In
2007, when Brazil was selected to
PwC research has found that a city or
host the 2014 World Cup, the federal
region needs to excel in four essential
government, cities, and business leaders
dimensions to capture attention on
recognized that they needed to engage
the world stage: quality services to
in smart planning to make the event
residents and businesses, sustainable
a success and bequeath a legacy of
development, visionary leadership, and
improved infrastructure to the host
consistency of image. Cities and regions
cities. The Brazilian Association of
already poised to achieve transformation
Infrastructure and Basic Industry, the
in these dimensions are best suited to
Brazilian Federal Ministry of Sports,
use the mega-event to accelerate that
and the Brazilian Football Association
transformation, as did Barcelona with
Munich’s acceleration of transportation and infrastructure projects
in preparation for the 1972 Games allowed the city to hasten urban
development by almost 10 years.
the 1992 Olympics. Similarly, the World sought an accurate picture of the cities
Cup football successes of Germany and vying to host the World Cup events.
South Africa also changed perceptions Once they were able to identify gaps,
of those countries globally. That might they could prioritize transformational
explain the fierce competition among new investments across the various
bidders for mega-events—Beijing, for dimensions of infrastructure, such as
example, edged out 10 contender energy, healthcare, security, sanitation,
cities in its bid for the 2008 Olympic transportation, seaports, airports, and
Games. It then embarked on a flurry telecommunications. Local governments
of investment in new infrastructure. meanwhile are planning transportation
enhancements to better allow spectators
According to the OECD, new to reach the events in host cities. In
construction will drive the bulk Manaus, for example, officials have
of investment in most developing embarked on one of Brazil’s most
countries as governments strive to ambitious urban mobility projects to
expand their networks.30 Mega-events date: a new monorail system that will
can certainly provide the incentive for benefit residents and businesses long
that investment, as they did in China, after football fans have come and gone.
13The monorail project in Manaus government officials announced that the
represents an excellent example of upper tier of several of the stadia will be
how a major event can impel long-term dismantled and shipped to countries that
infrastructure investment in a region currently lack football venues. The lower
that is already poised for transformation. tiers will remain as smaller facilities to
As does Rio de Janeiro’s Porto Maravilha host local sporting events.32, 33 As with
urban regeneration project being other successful mega-events, Qatar’s
undertaken for the 2016 Olympics. ambitious undertaking will require
collaboration with the private sector.
Also poised for transformation is Qatar,
a rapidly modernizing peninsula nation Public-private collaboration
in the Middle East that is fast becoming reduces risk
an economic, cultural, and sports hub.
The most successful Olympics derive
Winner of the 2022 World Cup football
from close collaboration between the
bid, Qatar is slated to spend close to $70
public and private sectors, according
billion on infrastructure. The country
to Michael Payne, who served on the
has committed to building a new airport,
International Olympic Committee for
a new rail system including rapid transit,
21 years.34 The Games represent an
a new network of roadways, and a
opportunity not just for the host city
bridge to neighboring Bahrain.31 Much
but also for the private participants
of this construction is part of Qatar’s
to make their mark—or strengthen
long-term vision for transformation
their position—on the world stage. The
by 2030. Renovation and stadium
1984 Los Angeles Games offer a high-
construction, of modular facilities that
profile example of private participation.
can be dismantled, are expected to
After severe financial setbacks a few
cost another $4 billion. All the stadia
decades ago—such as the Montreal
will be equipped with high-technology,
Games in 1976, originally estimated
outdoor air-conditioning systems to
at $310 million, but with a final tab
combat daytime summer temperatures
of $2 billion that took almost 30 years
in excess of 100 degrees Fahrenheit,
to pay off—many cities shied away
not uncommon in the Middle East.
from hosting the Olympics. In fact,
To accommodate legacy planning,
Los Angeles was the only bidder for the
$70B
1984 Games. With almost no public
financing, the Los Angeles Games
relied on private funding to bridge the
gap for hosting the Games. The first
Olympics Games to pay for itself, the
Los Angeles Games turned a profit of
Qatar expects to spend $70
$223 million for its host committee,
billion on infrastructure the Los Angeles Organizing Committee
upgrades. of the Olympic Games.35
14 PwC Game on: Mega-event infrastructure opportunitiesThe success of the Los Angeles Games Similarly, Vancouver’s Sea to Sky
has been replicated—and improved Highway project, also procured as a
upon—in the Games that followed. PPP, was completed in time for the 2010
Private partners have complemented Winter Olympics. That upgrade, also
public-sector know-how with part of the region’s long-term plan, will
additional funding, expertise, and most certainly pay for itself, according to
oversight. Take the example of Canada Norm O’Reilly, who served on the board
Line, a 12-mile regional rapid-transit of the Canadian Olympic Committee
line connecting downtown Vancouver, (COC) from 1998 to 2002 and worked
the Vancouver International Airport, on operations with the COC for the 2010
Best suited to large-scale infrastructure assets with ongoing
maintenance requirements, public-private partnerships can help
secure additional financing, offer specialized expertise, and better
manage risk.
and central Richmond in British Vancouver Winter Olympics. O’Reilly, a
Columbia. Although this new light-rail professor of sport management at the
system wasn’t part of the 2010 Winter University of Ottawa, explains that the
Olympic bid, the Games did serve as upgrade saves time as well as improves
a catalyst for the project, which was road safety on a highway that leads to
completed several months ahead of one of the most popular ski destinations
schedule as a PPP. Canada Line is the in North America. While the Games
first transit project in North America to accelerated completion, O’Reilly says
be developed as a PPP; it had been part the upgrade itself was “a no-brainer.”38
of the region’s long-term plan since the
late 1960s. Innovative tunnel design In fact, various levels of public-
and a service plan to generate more private partnerships have evolved
revenue from higher midday ridership over the course of several decades
resulted in proposed construction of collaboration for the Olympics.
cost savings equal to $85 million in Already widely used in countries such
net present value. Ridership began as the UK and Australia, they offer
tracking ahead of anticipated levels new opportunities for Brazil, Russia,
almost immediately after Canada and Qatar to attract private sector
Line opened in August 2009.36, 37 participation in infrastructure.
15In fact, the costs and benefits the World Cup are considered part
associated with mega-events present of the process of local and regional
ideal opportunities for public-private long-term development.40 Ultimately,
investment partnerships that serve residents and local businesses in cities
wider urban development goals. hosting mega-events benefit over the
Deals that are structured to be mutually long term when city planners and
beneficial to both the public and private regional leaders create and upgrade
partners are most likely to succeed supporting infrastructure in keeping
because each partner becomes an with long-range plans already in
active stakeholder. Depending on the place for the region. The mega-event
particular deal or type of infrastructure serves as a catalyst for accelerated
investment, private partners sometimes socioeconomic development, including
become long-term stakeholders. As securing sometimes elusive funding.
cities encourage more private-sector “The Olympic legacy is most effective
participation, they can realize the twin and pronounced where it goes with
benefits of improved access to capital the grain of wider urban policies
and greater budgetary certainty; and developments,” says Essex, the
well-structured contracts can allocate associate professor at the University
risks—related to cost overrun, delay, of Plymouth.41
and quality—to the private sector.
That legacy of wider urban
Infrastructure girds development, complete with
long-term prosperity supporting infrastructure, indicates
not only its energy in the present but
The impact of hosting major sporting
also its momentum for the future, as
events varies according to the level
reinforced by a 2010 PwC report on
of development in the host city
global cities.42 In fact, a 2010 World
and country, according to Andrew
Economic Forum report found that
Zimbalist, an economics professor at
underinvestment in infrastructure is
Smith College in Massachusetts who
a top 10 economic risk for the entire
has authored several books on sports
global landscape because infrastructure
economics. Zimbalist says with proper
is the foundation of a region’s
planning, hosting a large event can
prosperity and resilience.43A mega-
serve as a catalyst for infrastructure
event can accelerate infrastructure
development, thus benefiting less
development by a decade or more;
developed areas more than those
when done in keeping with previously
with a well-developed infrastructure
established local, regional, and
already in place.39
national plans, it can also afford
In Europe and Asia, for example, a region improved quality of life,
hosting events like the Olympics, competitiveness on the world stage,
the Commonwealth Games, and and long-term economic gain.
16 PwC Game on: Mega-event infrastructure opportunitiesEndnotes
1
Andrew K. Rose and Mark M. Spiegel, The Olympic Effect. National Bureau of Economic Research, October 2009.
2
Peter Kindel, Scott Watkins, and Andrew Hasdal, Land Use and Infrastructure Investments by Olympic Host Cities: Legacy Projects for Long-Term Economic Benefits,
Topografis & Anderson Economic Group, LLC, October 1, 2009.
3
E-mail communication with Stephen Essex, associate professor at the University of Plymouth, December 10, 2010.
4
Greg Clark, Local Development Benefits from Staging Global Events, Organization for Economic Cooperation and Development, 2008.
5
Michael Payne, “A Gold-Medal Partnership,” Strategy+Business, Spring 2007.
6
Greg Clark, Local Development Benefits from Staging Global Events. Organization for Economic Cooperation and Development, 2008.
7
Lee M. Sands, “The 2008 Olympics’ Impact on China,” The China Business Review, July-August 2008.
8
Sunil Jagtiani, “Track Record: Temporary Hurdle,” Fund Strategy, September 1, 2008.
9
William C. Kirby, “Do Olympic Host Cities Ever Win? A Huge Improvement for Beijing.” The New York Times, October 2, 2009.
10
Partnership for New York City, Grounded: The High Cost of Air Traffic Congestion, February 2009.
11
PwC, Cities of Opportunity, 2010.
12
National Audit Office (UK), Preparations for the London 2012 Olympic and Paralympic Games: Progress Report February 2010, February 26, 2010.
13
Ibid.
14
PwC, Gridlines, June 2010.
15
Interview with Mauricio Girardello, partner, PwC Brazil, May 26, 2010.
16
Mimi Whitefield, “For Next World Cup, Brazil Gets the Ball Rolling” The Miami Herald, July 27, 2010.
17
“Do Brazil’s Infrastructure Plans Have a Sporting Chance?” Project Finance, December 2009.
18
Sochi Organizing Committee, Position Statements, accessed April 1, 2011.
19
Sochi 2014 Bid, http://Sochi2014.com/en/legacy/.
20
Department of Transport, Republic of South Africa, Transport Action Plan for 2010, 2006.
21
PwC, Cities of Opportunity, 2010.
22
Organization for Economic Cooperation and Development, Policy Brief: Infrastructure to 2030, January 2008.
23
New South Wales Treasury: Office of Financial Management, The Economic Impact of the Sydney Olympic Games, November 1997.
24
PwC, Business and Economic Benefits of the Sydney 2000 Games: A Collation of Evidence, 2001.
25
PwC, Cities of Opportunity, 2010.
26
Holger Preuss, The Economics of Staging the Olympics: A Comparison of the Games 1972-2008, Edward Elgar Publishing Limited, 2004.
27
Metro Atlanta Chamber of Commerce, “Atlanta’s Olympic Legacy,” http://www.metroatlantachamber.com/files/file/communications/oly/finalolympiclegacy.pdf,
accessed February 10, 2010.
28
Dahshi Marshall, “Do Olympic Host Cities Ever Win? A Renaissance for Atlanta,” The New York Times, October, 2, 2009.
29
Metro Atlanta Chamber of Commerce, “Atlanta’s Olympic Legacy,” http://www.metroatlantachamber.com/files/file/communications/oly/finalolympiclegacy.pdf,
accessed February 10, 2010.
30
Organization for Economic Cooperation and Development, Policy Brief: Infrastructure to 2030, January 2008.
1731
Paul Kelso, “Hourglass Starts Running for Qatar to Vindicate FIFA’s 2022 Gamble,” The Daily Telegraph, January 10, 2011.
32
Qatar 2022 Bid, http://www.qatar2022bid.com/qatars-bid/legacy.
33
Matthew Futterman and Jonathan Clegg, “World Cup Headed to Russia and Qatar,” The Wall Street Journal, December 3, 2010.
34
Michael Payne, Olympic Turnaround: How the Olympic Games Stepped Back from the Brink of Extinction to Become the World’s Best Known Brand, Praeger, 2006.
35
Michael Payne, “A Gold-Medal Partnership,” Strategy+Business, Spring 2007.
36
Simon Kent, “Passing the Torch,” PM Network, December 2008.
37
PwC, Public-Private Partnerships: The US Perspective, June 2010.
38
Interview with Norm O’Reilly, professor of sport management at the University of Ottawa, September 25, 2010.
39
Andrew Zimbalist, “Is it Worth It?” Finance & Development, March 2010.
40
Greg Clark, Local Development Benefits from Staging Global Events. Organization for Economic Cooperation and Development, 2008.
41
E-mail communication with Stephen Essex, associate professor at the University of Plymouth, December 10, 2010.
42
PwC, Cities of Opportunity, 2010.
43
World Economic Forum, Global Risks 2020: A Global Risk Network Report, January 2010.
Infrastructure investment: What works best?
a
PwC, Business and Economic Benefits of the Sydney 2000 Games: A Collation of Evidence, 2001.
b
PwC, Gridlines, June 2010.
18 PwC Game on: Mega-event infrastructure opportunitieswww.pwc.com
For a deeper discussion about
mega-event infrastructure,
please contact our partners
who have advised on global
sporting events, including:
World Cup, Germany 2006 Global
World Cup, South Africa 2010 Capital Projects & Infrastructure Cities & Governments
Richard Abadie Hazem Galal
World Cup, Brazil 2014
United Kingdom Brazil
World Cup, Russia 2018 Tel +44 20 7213 3225 Tel +55 21 3232 6168
World Cup, Qatar 2022 richard.abadie@uk.pwc.com hazem.galal@br.pwc.com
Olympics, Sydney 2000
Latin America Central and Eastern Europe
Olympics, Beijing 2008
Mauricio Girardello Robert Gruman
Olympics, Vancouver 2010 Brazil Russia
Olympics, London 2012 Tel +55 11 3674 2469 Tel +7 495 232 5725
mauricio.girardello@br.pwc.com robert.gruman@ru.pwc.com
Olympics, Sochi 2014
Olympics, Rio de Janeiro 2016 Africa Asia Pacific
Stanley Subramoney Hongbin Cong
South Africa China
Tel +27 11 797 4380 Tel +86 10 6533 2667
stanley.subramoney@za.pwc.com hongbin.cong@cn.pwc.com
Europe Middle East
Julie D. Clark Stephen Anderson
United Kingdom Qatar
Tel +44 20 7213 4170 Tel +974 4419 2850
julie.d.clark@uk.pwc.com stephen.x.anderson@qa.pwc.com
© 2011 PwC. All rights reserved. “PwC” and “PwC US” refer to PricewaterhouseCoopers LLP, a Delaware limited liability partnership, which is a member firm of
PricewaterhouseCoopers International Limited, each member firm of which is a separate legal entity. This document is for general information purposes only, and
should not be used as a substitute for consultation with professional advisors. MW-11-0209You can also read
