Sao Paulo’s Morumbi stadium has been excluded from hosting any games during the 2014 World Cup after Brazil’s largest city missed a deadline to present financial guarantees for the venue’s required renovation.
Brazil’s soccer federation and FIFA said in a statement that they are open to further discussions with the city. Morumbi was the only stadium in Sao Paulo scheduled to host games from the tournament.
At stake for the city is 3 billion reais ($1.68 billion) of tourism spending during the competition from 500,000 tourists who would each spend about 300 reais a day, according to estimates by Sao Paulo Turismo SA, a government-controlled tourism promotion company. The figure doesn’t include lodging and transportation spending and the 20 percent increase in visitors the city may see in the two years following the event.
The federation also said today that Sao Paulo recently made another stadium proposal that won’t be considered because it missed a deadline. A spokeswoman for the Sao Paulo commission declined to comment today.
Games are also scheduled to take place in 11 other Brazilian cities in 2014, including Rio de Janeiro, Manaus, Brasilia and Porto Alegre.
Jerome Valcke, secretary-general of FIFA, soccer’s governing body, said May 5 that construction delays for projects related to the 2014 tournament are “incredible” and Brazil is “very late” in preparing for a tournament the country was awarded in 2007.
Sao Paulo’s Role
Luiz Barretto, Brazil’s minister of tourism, said yesterday that the exclusion of Morumbi stadium may not mean that Sao Paulo won’t host any games.
“There will not be cuts in the number of cities,” Barretto said in an interview from Johannesburg. “FIFA set deadlines for the 12 stadia and all the deadlines are being kept to. So everything is within the deadlines and everything is going as it should.”
The renovation of Sao Paulo Futebol Clube’s Cicero de Pompeu Toledo stadium, known as Morumbi, was approved May 14, according to today’s statement. The club had one month to provide FIFA with guarantees for financing of the construction.
“Losing that would certainly have an impact on the city’s economy,” Amir Somoggi, a director at consulting firm Crowe Horwath RCS in Sao Paulo, said before today’s announcement. “You have full hotels, full restaurants, increased spending on transportation, car rentals, security, the whole chain. You could easily lose 250 million reais you’d see every time you host a game.”
Brazil’s state-run development bank, BNDES, has said it will finance stadium construction with loans of as much as 400 million reais per city, or 75 percent of the project, whichever is lower. City and state governments must finance the rest or find private investors. BNDES hasn’t signed any contracts so far, said the bank.
By Paulo Winterstein
To contact the reporter on this story: Paulo Winterstein in Sao Paulo at pwinterstein@bloomberg.net
Editors: Brendan Walsh, Robert Jameson
To contact the editor responsible for this story: Joshua
Goodman at jgoodman19@bloomberg.net
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