FGV experts evaluate impacts of the World Cup

The World Cup is currently halfway and, despite the controversies surrounding its execution in Brazil, we note that some aspects are still not so clear. The analysis is made by FGV Professor Pedro Trengrouse, coordinator of the course offered by the institution and FIFA in Management, Marketing and Law in Sport. Some patriotic people believe that the World Cup will change the country for better, while others treat it as the main source of the problems that Brazil has had for decades. There is extremism on both sides, he said.Trengrouse explains that to talk about the impacts of the world cup, it is necessary to understand that the array of investment in the country has not fulfilled the expectations. I say that because all the studies took into account the investment matrix presented in 2010 by the government, he explained. However, in the professor's opinion, until this moment several infrastructure and urban mobility works left and entered the matrix, with budgets that vary greatly. Thus, this matrix has not materialized as expected, and therefore, the estimate of impacts ended up unreliable, he said.Regarding the legacy that the world cup will leave behind, Trengrouse said we can only consider an inheritance what the World Cup actually produced and not what we already had. According to him, the country's exposure to the world and the increase in international air flight bookings during the games - which increased 60% compared to the same period last year - can be considered a direct effect of the Cup. The other side of the coin is left to the trading sector. According to the trade association Clube de Dirigentes Lojistas do Rio de Janeiro (CDL-RJ), there will be a loss of approximately BRL 2 billion. Both due to the holidays and the type of tourists who come to the cities to watch the games. This type of tourist is made up of mostly backpackers, who do not consume as much as the tourists who come at other times of the year, he concluded.PricesAccording to the economist of the Brazilian Institute of Economics (FGV/IBRE), André Braz, the effect that the World Cup will have on prices is relevant now, but has an expiration date. According to him, the same way prices increased with the start of the event, they tend to retreat after its end. The demand for services will decrease with the return of fans to their regions or countries of origin. There's no way that the Cup will have a relevant and permanent effect on inflation.Braz also points out that, compared with the same period of 2013, the Consumer Price Index (CPI) increased by 0.29% in the first week of June, 0.33% in the second and kept the same result in the third. Eating out was one of the items that recorded the greatest increase: 0.48% in the first week, 0.63% in the second and 1.20% in the third. Hotels were left with 3.39% in the first week, 6.06% in the second, and recorded a decrease in the third with 5.59%.
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