POLITICS

Will the World Cup transform our image?

Jon Herskovitz asks whether the competition will do for SA what the Olympics did for China

JOHANNESBURG (Reuters) - The World Cup coming out party for South Africa will be the grandest the continent has seen but far more demure than other emerging countries that had their images transformed by hosting a global sports spectacle.

Japan, South Korea and China used their respective hosting of the Olympics to shed a troubled past and announce to the world with fireworks, eye-popping construction and jaw-dropping technology that they had arrived as global powers.

"The bar is set much lower for South Africa," said Ernest Aryeetey, a senior fellow and director of the Africa Growth Initiative at the U.S.-based Brookings Institution.

"The country just does not have the economic base that compares to those three countries when they hosted the Olympics. Its infrastructure has improved significantly but its economy is not ready to make the same leap," he said in a recent interview.

The government sees the Cup as increasing trade, tourism and prestige for itself while boosting the image of a continent where many states have been derided as basket cases dependent on overseas aid to fill their coffers.

South African President Jacob Zuma has said the Cup is "the single greatest opportunity we have ever had to showcase our diversity and potential to the world".

The national and regional governments have spent an estimated 40 billion rand to host the first World Cup in Africa, which is forecast to boost economic growth by 0.5 percentage points this year.

But growth forecasts for this year are between 2.3 and 3 percent, far below the double digit numbers in Japan prior to Tokyo hosting the 1964 Olympics, in South Korea when Seoul hosted the 1988 Olympics and in China when Beijing was the home for the 2008 Games.

FACTORY SECTOR LAGS

The Achilles heel for the South African economy, heavily dependent on its minerals for wealth, has been its manufacturing sector.

One conundrum is that global demand for its gold, coal and minerals pushes up the value of the rand, much to the anguish of exporters looking for a weaker currency to boost sales.

Another problem is that powerful unions and a ruling African National Congress, long-allied with organised labour, have led to a rigid job market, making it costly for manufacturers to take on employees in the country with at least 25 percent unemployment.

Japan, South Korea and China were all in periods of rising employment and wages when they hosted the Olympics with booming steel, automobile and other manufacturing sectors powering the economy.

They also dazzled the world with cutting-edge projects, such as the Japanese bullet train that took to the tracks in 1964 and could travel at speeds topping 210 kph (130 mph).

South Africa unveiled a new high speed rail link for the 2010 Cup that tops out at a more modest 160 kph.

The government's inability to cut into the chronic poverty, crime and unemployment that still stifle the country some 16 years after the end of apartheid have ratcheted down expectations, said Nic Borain, an independent political analyst.

"The original concept by (former presidents) Mandela and Mbeki was to use the Cup as a platform for South Africa to take its place as the African superpower," he said.

Borain said the Cup offers a rebranding chance for South Africa, showing it is far less crime-ridden than thought and far more capable of standing shoulder to shoulder with the world's top economies.

"South Africans can come out of this project and achieve a coming together on the issues of class and race that have divided us for so long," Borain said.

In the end, the euphoria for the Cup will die down with its legacy likely being infrastructure projects and a jolt of short-lived prestige.

This would be much like what happened in twice host Mexico, who take on South Africa in the opening match on Friday at a sparkling new stadium built in one of Johannesburg's poorest areas.

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