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Rugby cup means boost for business
By CNN's Geoff Hiscock, Asia Business Editor
SYDNEY, Australia (CNN) -- The world's biggest sporting event for 2003, the Rugby World Cup, is big business for host nation Australia, with an expected economic benefit of up to Aust. $1 billion ($680 million). Almost half of this money will flow to one state, New South Wales, which is the venue for Friday's opening match in Sydney and for the final on November 22. The other main Australian states to benefit are Queensland and Victoria. While the economic impact is well below that seen from Sydney's staging of the 2000 Olympics, leading economist Stephen Halmarick estimates the World Cup will add 0.2 percent to Australia's gross domestic product in the December quarter. Halmarick, Sydney-based head of Australia/New Zealand economic and market analysis for Citigroup, said much of the economic benefit will flow from the expected influx of 40,000 overseas visitors during the six- week period the World Cup is being staged. Halmarick said the international tourist inflow was likely to be even higher than the official visitor number, because many visitors were buying tickets via family and friends in Australia. Almost 2 million tickets worth about Aust. $200 million ($136 million) have been sold so far for the 48 matches that make up the World Cup schedule. Twenty teams are taking part, with games to be played in 10 Australian cities at a staging cost of about A$120 million. Halmarick notes that unlike the event-packed 2000 Olympics, there is more "down time" between World Cup games, meaning visitors will likely spend more time and money on other activities in Australia. Restaurants in particular are expecting strong business, based on their experience during the 2001 tour of Australia by the British and Irish Lions Rugby team. But some tourism operators now doubt the World Cup will be the bonanza they first expected. Hotel bookings are below original forecasts with many visitors from the UK, Europe and New Zealand opting to stay with friends or relatives in Australia, rather than pay for hotel rooms. Some hotels have dropped surcharges in a bid to hold onto bookings. Accommodation Website wotif.com is offering five-star hotel rooms in Sydney during the World Cup for A$260 a night, compared with the normal rate of A$485. Still, according to research cited by Halmarick, rugby union supporters open their wallets more than average tourists. They are expected to spend the same as international conference visitors to Sydney -- about A$400 to A$500 a day. Apart from visitor spending, the other big money areas are international broadcast rights, merchandising, international travel packages and sponsorship deals. All up, these are expected to net the International Rugby Board (IRB) about A$150 million. Sponsors include beverage companies Heineken, Coca-Cola and Diageo (Bundaberg Rum), financial services companies Visa, Lloyds TSB and Suncorp/GIO, telco Telstra, airlines Qantas and British Airways and carmaker Peugeot. Australia became the sole host of the World Cup last year when expected co-host New Zealand was unable to meet the IRB's commercial stipulation for "clean" venues, free of advertising that might conflict with the official sponsors.
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