1. TO: Dr. Marianna Richardson
FROM: William L. Taylor
SUBJECT: De Paula, Marilene. “The 2014 World Cup in Brazil: Its Legacy and Challenges.”
Klartext Verlag GmbH (2014). Accessed February 10, 2016.
http://www.solidar.ch/sites/default/files/project_files/study_world_cup_brazil_0.p
df
No event has ever gathered a more diverse crowd of people in the course of human history than
the 2014 FIFA World Cup. Drawing in audiences from around the globe, the 2014 World Cup is,
without a doubt, a spectacular event that greatly impacts the economy of the country that caters
it. My business topic seeks to analyze the economic impact caused by building new stadiums for
the 2014 World Cup on its host country of Brazil. The article written by Mrs. De Paula delivers
insightful information that examines the impact of World Cup stadiums being built in Brazil. Of
this information I find the following topics particularly interesting and relatable to my business
topic: (a) the sources of funding for new stadiums, and (b) Brazil’s public debt and economy.
Sources of Funding for New Stadiums
Once the new World Cup stadiums were complete, they were ready to be filled. The stadiums
were a fairly large success when it came to filling in seats. According to the article an estimated
3.17 million fans total watched the games in the new stadiums (p. 13). It raises the question of
how the stadiums were financed.
At first the stadiums were to be financed through private investors, however the taxpayers of
Brazil ended up carrying the majority of the costs for constructing, upgrading, and maintaining
the stadiums. The total cost of the 12 new World Cup stadiums alone is estimated to be at $4.21
billion dollars and the average construction cost per seat in the stadiums is six thousand two
hundred thirty dollars (p. 13). The
graph shown to the left compares
the average construction cost per
seat in the 2008, 2010, and 2014
World Cups held respectively in
South Africa, Germany, and Brazil.
From this illustration it is obvious
that Brazil has spent considerably
more on average per seat than the
previously held World Cup
countries on the list.
Brazil’s Public Debt and Economy
Before the 2014 World Cup many Brazilians were hopeful that the world-renowned sporting
event would bring in much needed economic relief to their country. Many hoped that between
building stadiums, and the tourism involved with the soccer games, job growth and generation
$0.00
$2,000.00
$4,000.00
$6,000.00
$8,000.00
$3,640 $3,380
$6,230
AverageConstructionCostPerSeat
South Africa Germany Brazil

2. would occur. The building of the new and massive World Cup soccer stadiums throughout the
country was even going to be paid for by private investors limiting the amount of taxation on
Brazilians.
However the results seem to display an opposite effect. In April of 2014 São Paulo daily (one of
the most influential daily news magazines in Brazil) announced a 51 percent increase in public
debt in the 12 host cities while, in the same period, public debt in the other capital cities where
stadiums were not being built increased by twenty percent, or less than half. As a result of this
increase in public debt, Brazil’s economy slowed and many among the civilian population
became unhappy with the amount that they were being taxed. Riots and civil unrest ensued
which resulted in the loss of business from investors.
By the end of the World Cup it was estimated by the Ministry of Tourism and the Institute of
Economic Research Foundation (FIPE) that “the World Cup injected BRL 30b into the Brazilian
economy, a sum approximating its total cost of BRL 25.6b, which amounts to 0.7% of Brazil's
GDP for 2013.” This shows that the net economic impact of the World Cup on Brazil was almost
nothing.
Conclusion
From this article I have learned a great deal about the sources of funding for new sports stadiums
and Brazil’s public debt and economy. This information will help me further understand this
complex economic situation. I have also derived a number of questions from this article that I
hope to explore further in my research. Some of these questions are the following: How much
did taxes increase for Brazilian taxpayers? Who were the private investors that backed out of the
stadium financing? By further researching I hope to find the answers to these questions and
more.