Economic World Cup Lessons for Lanka
Rohantha N.A. Athukorala
Just like any other great sporting events of the world like the Greek
Olympics costing 12.5 billion dollars and the Beijing Olympics that ran
a bill of US $ 40 billion, the soccer world cup in South Africa cost the
country US $ 4.3 billion which incidentally was 1.7 percent of the
country’s GDP.
This happens to be the highest recorded in the history of the games.
It is interesting, given that it is 10 times the budgeted cost estimate
done around six years back.
Shakira’s World Cup theme song Waka Waka created a new
record on U Tube |
But once again we see that a sporting extravaganza of this magnitude
has taken the country down the drain financially just like what happened
to Greece at the 2004 Olympics.
Some even say that the EU crisis stemmed from the project Olympics
that was mismanaged and it ultimately shaved off 2 percent of the GDP of
the EU. However, I strongly believe that the spirit of humanity gets a
boost with such events like this be it the Greek Olympics or the Beijing
games where the great Michael Phelps revealed how he overcame the
deficiency of the attention deficit disorder to conquer the world with
the eight gold medals.
World Cup Lesson 1: Brand South Africa
The games were a disaster with under-estimated costs, escalating
security budget and political in fighting on where public funds are
directed in the already challenged South African economy.
However, once the games were over President Jacob Zuma highlighted
that the world has seen South Africa in a different light. The world has
also seen the warm and friendly people of the country. The world has
also seen the precision of South Africa’s planning and logistics
arrangements Zuma said.
Sri Lankan Economy:
The lesson for Lanka is that the recently staged IIFA in Colombo, was
only the beginning of the re-branding exercise that Sri Lanka has just
begun. May be post the world cup that Sri Lanka will play host, we must
pitch for a biggy. I am not sure what this event will be but may be it
could be the World Economic forum.
World Cup Lesson 2: Full membership with international community
South Africa was ostracized from rugby and other global
sports due to the apartheid regime but the World Cup helped
South Africa be seen in a different light. |
Two decades ago South Africa was ostracized from rugby and other
global sports due to the apartheid regime. No one ever dreamt that
Nelson Mandela will walk free. Even today, most up market neighbourhoods
are under very high security.
However, the passion for sports made South Africa re-visit the
un-finished business -full membership with the international community.
The soccer world cup helped South Africa achieve this.
Sri Lankan Economy:
The dream of travelling from Galle to Jaffna is a reality. We must
now get full membership with the international community like what South
Africa did. It cannot be the world cup cricket as it does not reach the
total of EU and the Americas. Hence may be the only option is Miss
World.
World Cup Lesson 3: 80/20 Principle
There are 12 yards in distance from the penalty spot where the ball
is placed, to the mouth of the goal. 46 yards from half way place where
players stand when the match ends in penalties.
This means that a player has to walk 46 yards on his own, all the
while thinking through the penalty that he is about to take whilst
60,000 people are watching and may be millions on TV.
Sri Lankan Economy:
The basic lesson in life is that 20 percent of the issues create 80
percent of the bad publicity. This is also called the Pareto principle.
On this premise Sri Lanka must address the housing and livelihood
opportunities of the people in the Wanni.
This is around 163,000 new houses, repairs to around another two
hundred thousand so that we can avoid the 80 percent of the problems
that the international community keeps highlighting Sri Lanka for.
I guess we must address this as a priority if we are serious about
meeting this challenge.
World Cup Lesson 4: All about goals
Whatever the pundits say Goals win matches. Everything else is
commentary. Everyone predicted Argentina, Brazil, Germany and France to
win the world cup, but finally the teams that made it were Netherlands
and Spain. The logic being goals decides the winner and nothing else.
Netherlands in particular loved attacking the ball and that, got them in
to the final.
Sri Lankan Economy:
I feel Sri Lanka’s economy is very strongly goal driven. Be it the $
2000 per capita income, the achievement of the millennium development
goals, the defeating of the LTTE, the 800 wickets by Murali and the 7
percent GDP growth we achieved in the 1st quarter.
But the realities behind the numbers need to be understood.
Do these numbers reflect the true position in the regions outside the
western province? May be the time has come for a unique private public
partnership so that we achieve equity at all regions.
I guess we need to now build on this culture and set clear objectives
region wise so that we can then as a nation chase after them. After all
goals win matches and everything else is commentary.
World Cup Lesson 5: Fundamentals win games
I saw many a times at the World Cup where soccer players do amazing
things with the ball but when it comes to the moment of truth what we
see is that the team that play simple games on the fundamentals always
wins matches. If we carefully analyze the finals the only reason why
Spain won was because they stuck to the fundamentals than the Dutch, who
played fancy football but lost at the end.
Sri Lankan Economy:
We also need to stick to the fundamentals. As someone said we do not
need branded names for our economic principles like ‘IMF budget. The
fact is that a 9.7 percent fiscal deficit is not healthy for any
country. We have to get back to the fundamentals and correct this
situation with the support from the private sector. Either we can
privatize the loss making state enterprises of the state or a better
option is to offer it to the public. The Government can earn some money
and also ensure that good governance sets in to the system.
World Cup Lesson 6: Stay onside
Soccer has many rules and regulations and unless they are followed a
yellow card or becomes a reality. The Netherlands got nine out of the 14
cards for being away from the game rules in the final. This marred the
game and included the karate kick that brought disrespect to the game.
Sri Lankan Economy:
It’s very important that Sri Lanka be seen ‘On side’ to the rules of
the world, however right we are. We need to do this conciouslessly even
if things are tough. Whilst I say this given that I have worked in
global markets we as a nation should not tolerate in any way to be
bullied not be subject to double standards but we need to do this with
maturity.
We must not let the 20 percent of actions drive an 80 percent bad
publicity as we have to protect our global exports and international aid
that comes from many nations to countries like ours. This also applies
to the corporate sector to be on the ‘On side’ of the government in
power. It’s an unsung success ingredient in today’s world.
World cup Lesson 7: Loyal Fans
In the world of soccer we see how fans help teams stretch that extra
mile to win games for their country. The spirit that drives team is
crowd power. This is exactly what took Paraguay to beating some of the
more fancied names at FIFA 2010.
Sri Lankan Economy:
It’s very important to maintain the loyalty base in our brands in the
corporate sector as well as the countries that are loyal to our country
and supported the war.
We have to manage the CEPA issue with the Indians with maturity. I
also see how those in high offices working on week-ends in their
constituency to keep the loyalty of the voter base and essentially the
ordinary people in the lower level of the social strata. This means that
Sri Lanka is fast learning.
World Cup Lesson 8: Its all right to lose
Spain lost their opening match but went on to win the prize jackpot
the World Cup.
This means that failure is not the final of one’s quest to greater
heights. Its actually the beginning and a springboard to success. I
guess its all about how one reacts to failure and not the loss in the
eyes of the public.
Sri Lankan Economy:
I like to highlight an industry which is very close to my heart. The
tea industry of Sri Lanka.
Yes we were beaten last year by Kenya in the world stage of exports
but I am sure with the strong leadership that the industry is seen in
the tea sector, Sri Lanka will once again bounce back. But we need to
invest strategically.
Re-planting has to happen as in the corporate sector most tea bushes
are at senility stage.
On the demand end we must invest at least 20 million dollars to
demonstrate that post war, Sri Lanka is a nation to watch in the world
stage of business.
World Cup Lesson 9: Prepare for spot kicks
The truth is that we must be ready to take the spot kicks that life
offers us. I saw many a teams at FIFA losing the games due to spot kicks
that were actually not right. But it’s the same with life as life is
never fair all the time.
Sometimes life does not give one what one deserves. Sometimes even
after much preparation, we are not ready to take the opportunities that
life offers.
Sri Lankan Economy:
I see that same opportunity for Sri Lanka that is not exactly fair.
Namely the 50,000 houses that the Indian government has offered as a
grant for the people of Vanni. The reason that I am saying it’s not fair
is because I have worked in India and in the outskirts of places like
Behala in Calcutta, and I have seen that there are more people in India
that require basic housing, than Sri Lanka. But we have got this ‘Spot
kick’ in life and now must take it. We must cut through the bureaucracy
and get the architecture right so that we can use this facility at the
earliest.
World Cup Lesson 10: Don’t count on referees
There were many blunders at the Last World Cup. In fact FIFA
President Sepp Blatter made a public apology after having watched the
video goal reviews. But most teams decided that they need to monitor
competitor behaviour and alert the referee as and when required when
things were rough than, just leaving it to the referee.
Sri Lankan Economy:
The implication to Sri Lanka is the same when it comes to the mobile
phone industry and the privatized tea industry of Sri Lanka. If not just
like what I was saying before the whole industry can be in the red once
again.
World Cup Lesson 11: Believe in being lucky
To win a World Cup one needs to be in lucks way too apart from the
sheer skill that one demonstrates. But this can happen only if one
believes that you can be lucky. We have heard many a times where there
were statements like the ‘hand of god’ but these happen only to those
who believe.
Sri Lankan Economy:
Let’s accept that Sri Lanka is a lucky country as a whole. If the
Mumbai attack did not happen in India, Prabhakaran would have some how
twisted the arm of India. When things were rough financially the
financial crisis happened and oil prices plummeted from 150 dollars to
28 that let to the 40 percent decline in our import bill in 2009. We
must now believe in luck and re imagine and recreate as per the theme of
the CIMA conference.
World Cup Lesson 12: Recruit A-B-C grade performers
If we take Brazil, Italy, Germany, Spain or Netherlands they have a
game plan to recruit systemically from local clubs to schools and then
at club level. Their logic is that it’s a war for talent and retaining
this talent needs focus with consistency.
Sri Lankan Economy:
We need to have this same spirit in the public sector. After having
served the country in the national economy what I see now is a set of
high level authorities that are very competent and performance led. May
be because the election has brought in a young set of politicians that
are very strongly performance driven. Hence the second bench is strong
that drives performance at the top. We need to now let this drive to the
rest of the levels so that we can see the reforms that are coming into
the system will get implemented.
The World Cup in South Africa is very dubious from a financial
perspective even though economists predict that the country grew by 0.5
percent to 2.2 percent due to the world cup. But the reality is that
unemployment levels have increased and the country will have to pay its
debts due to the World Cup for the next generations to come. But the
lessons it has taught the world makes such events the need of the hour
where humanity is in question. |