FIFA's Demands
Holland and Belgium's bid essentially came to an end when they disagreed with the seven demands of FIFA. These are mainly to do with tax, workers rights and work permits. In terms of tax, FIFA ask that they become exempt from any form of tax, and that their affiliates also receive breaks if not exemption as well. This would mean that major companies such as Adidas, Coca Cola and Visa, all of whom are major companies that have UK bases, would be contributing much less to the an economy which needs all the money it can get.
At a time when the number of immigrants coming into the country is a big issue, one thing that FIFA ask is that work permit regulations are suspended for the tournament. There are concerns about the number of international students that finish their courses and don't leave, so in suspending the regulations to allow more fans to come over, which I agree too in principal, could end with more people not leaving. It would be the perfect chance for people from struggling African nations to come across and settle.
Myth - Tournaments Bring Economic Growth
There are many different areas to look at both in terms of the money coming in and the money that is spent.
Stadiums and Hotels - Although this wouldn't have been an issue for England, many nations bid to host the tournament knowing they would still have to build the facilities. Many believe that the need for new stadiums creates new jobs. Most construction workers will already work for the major construction companies, and it won't just be one sole construction company but many that will have plenty of workers already. This will create a need for more workers elsewhere, allowing these companies to charge more and generally raising costs. Due to the amount of workers needed, they are also able to demand more as they know they will be able to get more work for more money. So while there will be a limited amount of extra workers needed, it is not enough to get carried away by.
Another issue is what happens after the tournament. Poland hosting Euro 2012 is a good example here. UEFA, for its officials and guests, needs one entire five-star hotel within 45 minutes' drive of every stadium. Then there are team hotels (five-star), referee's hotels (also five-star) and the drug testers need hotels 'in the countryside' (again, five-star). All this will have to be paid for the Polish Government, and that is before you take into consideration the use of the stadiums after the tournament. Each stadium needs to have a minimum capacity of 40,000, yet the average attendance for the 2007/08 season in the Polish Premier League was only 7,329 (2nd Division average 3,167). The new facilities would, for the most part, be redundant straight after the tournament. The amount of five-star hotels would also mean that they would mainly remain empty.
Employment - Although this has partially been covered in terms of building, it is expected to create extra demand for jobs in other areas. This is exaggerated. In a study carried out by the University of Liverpool, one of the host cities for Euro 96, only 30 new jobs were created, all of which were temporary.
Visitors - It was believed that for Euro 96 that there would be around 250,000 visitors for the tournament, but the figure was closer to 100,000. One way that economists used to look at spending at tournaments was to multiply the expected number of 'visitors' at matches by the a rough number relating to money spent on meals, hotels and transport. The problem with this was that not every 'visitor' was a tourist, but in fact English people who had travelled to watch games in different areas of the country, so instead of spending money in one part of the country, they were simply spending it somewhere else. It was found that in Germany 2006 around half of the 'visitors' were German, again, they had simply travelled to different areas of their homeland, therefore adding no extra money to the economy. Whether there was a tournament on would make no difference to them, they would instead spend money in different areas. While it is believed that many would have stayed in Germany that summer for the football, others will have left the country to get away from it, again, offsetting the amount of money spent at the tournament. A team of economists found the spending by visitors at the 2006 tournament to be around €2.6 billion, much less than the German Government had spent in preparations for the tournament and a relatively small amount when compared to the €1,000 billion spent annually by German consumers.
From this it can be seen that hosting a tournament such as the World Cup or the European Championships doesn't bring the cash bonanza that many, including the politicians behind the bids, believe it will. In many cases it results in countries losing money, which is in no way helped by FIFA's demands. I would have loved the World Cup to be hosted in England, to travel around the country seeing great teams play and visiting place I'd never been before, but in reality it may be for the best that we don't.
