Hosting the 2010 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 R,8-billion budgeted, according to a Sunday newspaper.
City Press said a further R3-billion 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 in 2004.
Jabu Moleketi, Deputy Finance Minister and a member of the World Cup Local Organising Committee, agreed costs had risen but told the paper 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% in May, far exceeding the 3% to 6% 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. – Sapa-DPA