Hosting the 2010 football World Cup will set South Africa
back much more than initially estimated, with rising costs expected to
swell the bill for stadium construction to well over the R9.8-billion
($1.28-billion) budgeted, according to a Sunday newspaper.
City Press said a further three-billion rand would be needed to cover
the rising costs of an ambitious stadium-building programme, without giving
a source for the figure. Five new stadiums are being built for the tournament
and five others are being upgraded.
Earlier this year officials in Nelson Mandela Bay said that they had revised
the budget for their World Cup stadium from R711-million, as projected
in 2006, to R1.5-billion due to an "escalation in construction costs".
The budget for the ten stadiums currently stands at a total of R9.8-billion,
up from the R6.7-billion South Africa initially agreed to spend when it
won the right to host the tournament back in 2004.
Jabu Moleketi, deputy finance minister and a member of the World Cup Local
Organizing Committee, agreed costs had risen but told City Press he couldn't
give an exact figure for the escalation. Earlier this month LOC Chief
Executive Danny Jordaan said he expected the bill to exceed R10-billion.
For the extra money, the nine host cities would have to look not only
to government but to the African Development Bank for low-interest loans,
Moleketi said.
Jordaan said the escalating costs were in line with global trends such
as rising petrol prices "and the exchange rates." Inflation
shot up to 10.9 per cent in May, far exceeding the 3-6 percent target
set by government.
The rand has also fallen sharply against major currencies over the past
year, on the back of growing political uncertainty and falling growth,
caused in part by an energy crisis.
A weaker rand makes imported raw materials more expensive.
