Cabinet approves South Africa's bid to host the 2023 Rugby World Cup

Cabinet approves South Africa's bid to host the 2023 Rugby World Cup



Good news for sports fans

Good news for the economy

Cabinet, at its meeting of 1st August 2017, approved a request from the Minister of Sport and Recreation, Mr Thulas Nxesi, for South Africa to bid to host the 2023 Rugby World Cup. The outcome of the bid will be announced in November 2017, with Ireland and France being the other bidders. The Rugby World Cup is one of the largest single-sport events, considered to be in the tier behind only the Summer Olympics and the FIFA World Cup.

A successful bid by South Africa will consolidate our track record of successfully hosting mega-events. It will further position the country in the global mind-set as a winning nation and a leading sport tourism destination with tourism having been identified as a national economic priority for job creation and economic growth.

A successful bid also speaks to another of governments priorities that of  promoting social cohesion and nation building.

Government has also learnt from previous experiences  particularly the cost overruns and collusion which accompanied 2010. It was government's refusal to sign an open-ended blank cheque that led to South Africa withdrawing its bid to host the 2022 Commonwealth Games. An open ended 2022 Commonwealth bid could not be justified in the present economic circumstances.

That is why the request for Cabinet approval to bid for the 2023 Rugby World Cup was kept and packaged as an economic bid which would minimise demands on the fiscus whilst it stimulate economic activity, employment and empowerment.

South Africa has modern world class stadia as part of the legacy of 2010 therefore our stadia exceed the bid requirements so, there is little new capital investment required.

An independent Economic Impact Assessment commissioned by SARU (South African Rugby Union) indicates the following positives:

-        Direct, indirect and induced economic impact of R27 billion over the 2 months of tournament related activity;

-         38,600 jobs with a payroll of R4.4 billion;

-         R5.7 billion to low income families;

-         R11 billion direct spend;

-         200 000 foreign tourists (compared to the 300 000 that arrived in 2010); and

-         An estimated tax benefit to government of R1.4 billion.

This last point is important in offsetting the R2.7 billion in government guarantees required for the bid to go ahead. The rest of government guarantee will be recouped through a profit-sharing agreement with SARU which will also benefit the development of South African Rugby as well as smaller sporting codes in country.

A successful bid will also address another government priority: sport development and transformation. SARU is committed to growing and transforming the sport in the period up to 2023, also leaving a lasting legacy for the development of Rugby in underprivileged communities. The tournament will be leveraged to support other government priorities: including the 30% set-aside for SMMEs, preferential procurement and adherence to the Sport Transformation Charter.

A successful bid will be a win-win for sport development, for the economy and for the nation as a whole.



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