Qatar upbeat about World Cup 2022, but worried about financesBy Rahul Dass, IANS
Monday, December 6, 2010
ABU DHABI - Qatar, the host for the 2022 FIFA World Cup, needs billions of dollars to set up the infrastructure for the sports extravaganza. But that has not dampened the spirit of Qataris who are “absolutely delighted” on being made the host for the football event.
A replica of the FIFA World Cup gold trophy was proudly displayed at the centre of the Qatar pavilion. Qatar is part of the six-nation GCC that has as it members Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and UAE. A two-day summit of the GCC begins here Monday.
Though Qatar, with a population of just around 1.5 million, may be upbeat about becoming the host nation for the biggest football event, a media report said that Qatar will soon have to start thinking as to how it will pay for the billions of dollars worth of infrastructure and other upgrades it will require to host the World Cup successfully.
Qatar plans to build nine stadiums and renovate three others. It will invest over 100 billion Qatari rials in infrastructure projects. “Whether they will increase the level of debt or not is an important question,” The National quoted Brahim Razgallah, chief economist at JP Morgan, as saying.
He was of the opinion that governments have in the past underestimated the cost of hosting large sporting events such as the football World Cup and the Olympic Games.
Razgallah said: “They’ll finance some of this spending through debt markets. It’ll increase the burden, but it’s not like the energy sector: a lot of these projects will take a long time to bear some of the benefits and bring profits to the country.”
Credit ratings agency Standard & Poor’s (S&P) analysts, however, were of the opinion that Qatar would have ample resources to fund projects related to the World Cup without tapping the debt markets.
Luc Marchand of S&P said Qatar had “a lot of margin for manoeuvre” due to its natural resources and sovereign wealth assets.
“Not much more sovereign debt is expected. As in the past, most of the infrastructure will be financed via the budget revenues, directly coming from the oil and gas sectors,” The National quoted him as saying.
“Private sector financing is generally asked to play a bigger role, notably in the hotel industry and real estate.”
(Rahul Dass can be contacted at firstname.lastname@example.org)
“We are proud to be the host for the 2022 World Cup,” said a Qatari national at an exhibition held here on the eve of the Gulf Cooperation Council (GCC) summit.
The Qatari national, who only gave his name as Ahmad, told IANS that he and his countrymen were “absolutely thrilled” on becoming the host country.