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The Economic Impact of AFCON to Gabon

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The ongoing AFCON is said to have cost Gabon over 760 million dollars to prepare and host. A section of Gabonese believe it is worth the expenditure but others question the economic justification in hosting the event and its impact locally.

The 31st Africa Cup of Nations (AFCON) football tournament kicked off in Gabon on Saturday 14th January 2017. It It is the first time the small central western African nation  is hosting the tournament after joint hosting with Equatorial Guinea in 2012.

 An economic blessing…

 Hosting the tournament will have some obvious economic benefits for Gabon. According to The Daily Maverick, it will offer the nation an opportunity to position itself as a premier tourism destination to prepare for the day its oil reserves run dry.

This is the sentiment felt across the continent as the slowdown of global commodities prices has presented an opportune time for African economies to diversify away from commodities and has forced governments to seriously consider structural reform.

There seems therefore to be no better way to put one’s name on the map than a big sporting event. Gabon boasts beautiful wildlife, national parks and picturesque beaches dotted around its coastline. Tourism increases have been shown to go hand-in-hand with big sporting events. It is reported that AFCON could boost the tourism economy by around $150 billion if marketed well (The Daily Maverick).

 Moreover, the global audience for AFCON is rising as a result of the increasing number of African footballers playing in European leagues. This is being reflected in increasing amounts of global television coverage and sponsorship from leading brands. In 2009, Orange signed an 8 year agreement to become official sponsors of the tournament, seeing it as a great opportunity to raise their profile, not just in Africa, but globally.

With the funding and backing of global brands and networks, this will undoubtedly give a boost to any host nation and to the status of African football overall. The tournament has proven beneficial to competing nations individually too.

BBC Africa  reports that the defending champions, Cote D’ivoire have been given a financial boost by the Ivorian government who have approved a near €6 million (£5.1m) budget for the team’s campaign in Gabon. Additionally, The Confederation of African Football has revealed that this year’s winners will collect up to $4m (£3.26m) in prize money, which is a 64% increase from a previous $1.5m (£1.2m).

 Or burden…

 However, most indicators actually suggest that the economic benefits of the tournament fail to materialise. For instance theforeignreport.com reports that in fact in Gabon and Equatorial Guinea for AFCON 2012 there was no significant rise in tourism during the competition and matches that took place where the hosts were not involved or where major stars were not playing witnessed very low attendances. For example, the official attendance when Sudan played Burkina Faso was only 132.

The idea that fans from across the continent and beyond could be lured to the country to support their international teams was, unfortunately flawed. Despite the undeniable buzz of the tournament, poverty and poor infrastructure remain an unfortunate but undeniable part of most African economies.

Tourism will remain stagnant where fellow Africans are unable to travel between neighbouring countries with ease (it is currently easier for North Americans to travel between African countries than Africans themselves, as African citizens need visas to travel to up to 55% of the continent) or cannot afford match tickets (this years tickets will cost between $0.80 – $63; the average per capita salary of SSA is $762).

 Ensuring success

 In 2012 Gabon spent in the region of a million dollars and the African Economic Outlook believes that the work done to prepare for the competition contributed to slower economic growth for the 2012-2013 financial year. Hosting the tournament is obviously no easy feat, as it requires lots of investment and quite often large scale infrastructure development – especially for developing African nations.

Arguably, such investment is necessary for an economy attempting to diversify and expand – be they AFCON hosts or not. On the one hand AFCON represents an important incentive to drive infrastructural development. Additionally, investment will never come cheap but can only reap long term benefits for a nation’s economy.

 Still, Gabon and other potential host nations must question whether or not it would be financially viable and/or economically beneficial to host a major football tournament.

Each nation must individually look inwards before making a bid to host and avoid being lured by promises of tourism and exposure. Asking questions like – will the costs outweigh the potential lure of tourists? Are there more pressing socioeconomic issues to focus on?  For example The Democratic Republic of Congo applied to host the tournament in either 2015 or 2017 but withdrew their bid in 2010 citing too many other commitments in the next few years. Such considerations are absolutely necessary to ensure a country’s economic viability and the success of the tournament.

Finally, those countries that do decide to host the games must find ways to retain the revenue flows and ensure that whatever money is made is not misappropriated but reinvested into its development. Jamie Hitchen of theforeignreport.com suggests that the Governing Body of African Football should take a leaf out the books of the likes of Didier Drogba, Clarence Seedorf, and Samuel Eto’o who through foundations have utilised funding and exposure for the benefit of community based projects across the continent.

Overall, the Africa Cup of Nations itself stands as a symbol of development and comradeship on the continent and therefore hosting will have its natural benefits.

However, in order to ensure the economic sustainability of it’s host nations and the success of the tournament itself, it is imperative that individual countries take a holistic approach when considering its candidacy as a host nation and ensure its benefits are truly felt on the ground.

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