What is Qatar winning?

How will Qatar pay back the cost of hosting the World Cup with hundreds of billions of dollars? Qatar won

2022-11-25 09:06:04

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The huge investment of US$220 billion in the Qatar World Cup has aroused heated discussion from the outside world. Can such a large investment recover the cost? Qatari media pointed out that a comprehensive account needs to be calculated.

At the opening ceremony of the World Cup on November 20, the host country Qatar not only showed its unique Middle Eastern culture and Gulf customs, but also provided a stage for improving relations between countries in the Middle East.

How did Qatar repay the debt for the US$200 billion World Cup? Qatar won

At the opening ceremony, Qatar’s Emir Tamim shook hands with Saudi Crown Prince Bin Salman Yan Huan arranged for him to take a seat at the core of the rostrum. Foreign media pointed out that this series of actions shows that the relationship between Qatar and Saudi Arabia has been repaired to a large extent. In 2017, Saudi Arabia, Egypt, the United Arab Emirates, and Bahrain announced that they were severing diplomatic relations with Qatar and suspended personnel and transportation exchanges with Qatar on the grounds of supporting terrorism and interfering in internal affairs. It was not until January 2021, with the mediation of the GCC, that the crisis of severing diplomatic relations eased.

How did Qatar repay the debt for the US$200 billion World Cup? Qatar won

A photo released by the Turkish Presidential Palace showed that during the opening ceremony of the World Cup in Qatar on the 20th, Turkey President Erdogan and Egyptian President Sisi shook hands and exchanged greetings when they met for the first time. Previously, when the Egyptian military led by Sisi dismissed then President Morsi, Erdogan severely criticized Sisi many times, and Turkey-Egypt relations deteriorated.

How did Qatar recoup the cost of hosting the World Cup with US$200 billion? Qatar won the money

In addition, Qatar and Israel launched temporary direct commercial flights during the World Cup on the 20th. The two countries have not established diplomatic relations, and the outside world generally believes that the opening of direct flights is a major breakthrough in the relations between the two countries. According to Israeli media reports, 4,000 Israeli fans and 8,000 Palestinian fans are expected to take direct flights to Qatar to watch the game.

How will Qatar repay the debt for the US$200 billion World Cup? Qatar won

Local media analyzed that since the outbreak of the Russia-Ukraine conflict, relations between major countries in the Middle East have changed. The strategic autonomy of regional countries has been significantly strengthened, and regional relations have undergone major adjustments. Against this background, the Qatar World Cup has successfully opened, and Saudi Arabia, Turkey, Israel, Egypt, etc. will naturally not miss this football diplomacy opportunity. Since the Qatar World Cup is the first World Cup held in the Middle East, many Arab countries also regard it as "their own World Cup."

Qatar media commented that hosting the World Cup can enhance the country's soft power, make Qatari citizens proud of the country, and improve Qatar's image on the international stage.

Qatar covers an area of ??about 11,500 square kilometers, smaller than Beijing, and has a population of less than 2.7 million. A century ago, Qatar's main industry was natural pearl collecting. Since the 1930s, the oil and natural gas industries have become the mainstay of Qatar's economy. In recent years, the government has invested heavily in the development of natural gas and is the world's largest producer and exporter of liquefied natural gas.

After the outbreak of the Russia-Ukraine conflict, overseas market demand for Qatari liquefied natural gas surged. According to Qatar’s official media reports, Qatar Energy’s oil and liquefied natural gas revenue surged by two-thirds in the first half of 2022, reaching US$32 billion (approximately 230 billion yuan). The dividends brought by oil and gas resources have enabled the per capita GDP to exceed US$60,000, ranking among the highest in the world.

Qatar revealed that although the overall expenditure of the World Cup is huge, eight new stadiums were built and renovated for the World Cup, with a total cost of only US$6.5 billion to US$10 billion, and the rest of the funds were spent on infrastructure. The hosts built new airports, hotels, shopping malls, subways, roads, and even upgraded the original desert village of Lusail into a modern city. During the competition, it is expected that 1.2 million to 1.7 million tourists will flock to Qatar, and the resulting tourism revenue and economic activities will contribute approximately US$17 billion to the Qatari economy.

Qatar believes that hosting the World Cup has improved the country's infrastructure construction and can attract more foreign investment and international tourists in the future, promoting the realization of the national development strategy "National Vision 2030".

The core of this vision is to build a country with sustainable development, strong international competitiveness and a high standard of living for its citizens by vigorously developing economic diversification.

Akinci, an economics scholar at Uludag University in Turkey, believes that Qatar not only demonstrates its highly developed economic and technological strength through the World Cup, but is also accelerating the transformation of its development model through this international event, from an energy-based country to Transformation into a service-oriented country.

Every "small goal" number is exaggerated. Aren't Qatar and FIFA afraid of losing money?

In fact, after a century of development, the World Cup has already formed a complete commercialization path and profit system. From TV broadcasts and advertising sponsorships to as small as a ticket and a peripheral, the economic effects have always been the "golden sign" of previous World Cups: the 1998 World Cup in France turned France's GDP from negative to positive, achieving a GDP growth of 4%; South Africa in 2010 The World Cup brought $4.9 billion in fiscal revenue and 130,000 jobs to South Africa; the 2014 World Cup in Brazil created economic benefits of up to $15 billion.

"There is no doubt that the World Cup is the world's top event second only to the Summer Olympics in terms of influence or ability to attract money." Wang Haoyu, director of the Sports Finance Research Center of Tsinghua University PBC School of Finance, told People's Daily Online's "Cai Mi You Yan" stated that the main entities that "absorb money" through the World Cup can be roughly divided into five categories: FIFA, World Cup host countries, media and sponsors, sports betting industry, and global manufacturing companies.

Data show that 95% of FIFA’s total revenue comes from the World Cup. According to agency estimates, more than 1.2 million foreign fans will enter Qatar during the World Cup, staying for an average of 4-5 days. Assuming that one person consumes 2,000 yuan per day, a series of consumption such as football tickets, hotels, and restaurants will bring the equivalent of several billion yuan to Qatar. One billion yuan in revenue.

For the global sports industry chain, every World Cup is also a major opportunity. According to estimates from the Yiwu Sporting Goods Association, from World Cup balls to fan speakers; from jerseys of each team to Hercules Cup ornaments and top 32 flags... "Made in Yiwu" has accounted for 70% of the entire World Cup peripheral goods market share. .

“For a country, hosting a large-scale event cannot simply be calculated by the amount of profit and loss.” Gao Zhaoyu, a researcher at the Sports Industry Development Research Center of Tsinghua University, told People’s Daily Online’s Money, Rice, Oil and Salt. This World Cup has three "firsts", namely the first time it is held in a Middle Eastern country, the first time it is held in the winter of the northern hemisphere, and the first time it is held by a country that has never entered the World Cup finals. For a resource-based country like Qatar, hosting the World Cup can enhance its cultural soft power. It can be said that "the world knows it once it hosts the game."

Wang Haoyu pointed out that with a long-term perspective, Qatar’s investment of more than 20 billion US dollars is mainly concentrated in infrastructure such as railways, subways, stadiums, airports, hotels, etc. These investments will also become the basis for the long-term development of Qatar’s economy. Stable support.

According to the International Monetary Fund’s forecast, Qatar’s economic growth will reach 3.4% in 2022, and driven by the “World Cup Economy”, the GDP growth rate will rise to 4.4% in the future.

“Whether it is economic, humanistic, environmental protection and other aspects, the World Cup allows fans to enjoy the passion for sports while also promoting the world to enjoy the dividends of the World Cup.” Gao Zhaoyu said.

In other words, with the opening of the World Cup, the "football spirit" has been ignited. For the host Qatar, the close connection with the world's most successful players may have just begun. (