13 July 2006

South Africa: Business Throws Its Weight Behind 2010

Johannesburg — SOCCER world governing body Fifa will have its biggest budget ever by the time it holds the 2010 soccer World Cup in SA, the local organising committee CE Danny Jordaan said yesterday.

Jordaan said for the period between next year and 2010, Fifa had already secured $3,1bn, which he said was the biggest amount in Fifa's history.

In the period between 2003 and 2007, which included the recently concluded tournament in Germany, Fifa had $1,8bn.

The money comes mainly from corporate sponsors and broadcasting rights.

Jordan said broadcasting rights in Asia, Africa and South America for the 2010 tournament were still outstanding. The $3,1bn figure could go up, with more sponsors likely to come on board.

Jordaan said the fact that big corporations were prepared to dig deeper into their pockets showed their confidence in SA's ability to host a successful tournament.

He was speaking after a working group meeting between government and Business Unity SA (Busa), which represents business. President Thabo Mbeki, Deputy President Phumzile Mlambo-Ngcuka and several ministers attended.

Busa president and businessman Patrice Motsepe and AngloGold Ashanti CEO Bobby Godsell, who is the organisation's chairman, were part of the business delegation.

"Africa has waited for many years to host the World Cup. The argument that has often been used is that a World Cup in Africa will not constitute a strong business case," Jordaan said.

Government and soccer authorities had to move swiftly recently to reassure South Africans and the rest of the world that the country would be ready to host the World Cup in four years' time. That was in response to scepticism about SA's preparedness to host the event.

Fifa uses money generated by world cups to fund its activities, which include supporting less lucrative tournaments such as women's and junior world cups. Some of the money also goes to the local organising committees, the body's member associations as well as continental confederations.

The top tier of sponsors includes conglomerates Coca-Cola, Emirates Airline, Hyundai, Sony, Adidas and Visa. These are known as Fifa partners, said to be highest level of corporate affiliation to the soccer body.

The second tier includes companies such as McDonald's and MasterCard. McDonald's recently extended its Fifa World Cup sponsorship from 2007 to 2014, a period covering the next two World Cups.

The third band of sponsors, which for 2010 will comprise six South African companies, is also known as "national supporters".

Jordaan said so far two South African companies were on board. First National Bank (FNB) last week became the first South African company to sign up under Fifa's "national supporters" programme. The bank has committed $30m.

He said the local organising committee would today announce the second national sponsor.

Jordaan said the national sponsors would come from different areas of business. "One of the key aspects of sponsorships is exclusivity." He would not say which other areas would have exclusive sponsors, besides banking which has gone to FNB.

Addressing the same media briefing yesterday, Trade and Industry Minister Mandisi Mpahlwa said the working group had discussed a range of issues, including the integration of the "second economy" into the mainstream economy.

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