Friday, April 27, 2007

Rugby cup: worth its weight in gold for France

The main French campus of the prestigious Essec Business School is located less than an hour away from the heart of Paris, at a place named Cergy-Pontoise. [Click here to see their English-language website.] Recently, this beehive of bright business experts received an interesting assignment: calculate the likely global income, for France, resulting from the forthcoming World Rugby Cup. Well, the result is huge: some 8 000 million euros! In US currency, that's roughly 11 billion dollars. In Australian currency, nearly 13 000 million dollars.

Where is all this money coming from? Let's carry on the discussion in euros, using the US definition of a billion as a thousand millions.

— The Essec wizards inform us that half the estimated income, 4 billion euros, will be deposited in cash before the end of the matches, which will be taking place in September and October. More than 350 thousand foreign visitors will be arriving in France for the rugby festivities, accounting for income of 1.5 billion euros. The matches will ne watched on TV by 260 million viewers, generating revenue of 2 billion euros, whereas ticket sales for live spectators will have generated a non-negligible income of 250 million euros.

— The other half of the projected revenues are of a more ethereal nature. The French "rugby economy" will receive a huge boost, estimated at 417 million euros a year, from the presence of the World Cup. And French tourism, as a consequence of the World Cup, will receive a boost of some 625 million euros a year. So, if you carry out the multiplications, that gives us, for a period of four years, 4 billion euros.

In old-fashioned French village talk, there's a celebrated dictum: Un sou est un sou. In US English: A dime's a dime. In other words, we should respect frugally every penny we might earn or possess, and not spend money lavishly.

Economic and political experts have pointed out that money from the forthcoming World Rugby Cup can be seen already as a fabulous welcome gift to the future president of the French Republic. The funny thing about this whole affair is that the Essec people don't seem to give a screw about who might or might not actually win the golden trophy.

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