By Manuel Veth –
The World Cup 2014 in Brazil was hailed by some media outlets as the greatest tournament of all time. But while the action on the pitch may serve as the benchmark for future tournaments, the headlines circling the organisation of the tournament will serve as a serious warning for the next edition of football’s most prestigious tournament, to be held in Russia in 2018.
Both Russia and Brazil share a place among the BRIC grouping acronym, which refers to four emerging market powerhouse economies – Brazil, Russia, India and China – all deemed to be at a similar stage of economic development and expected to be among the world’s most dominant economies by the year 2050 . Such similarities are leading analysts to use Brazil’s experience as a guide, or more importantly as a source of foreboding concern for Russia over the next four years.
Building a World Cup: BRIC by BRIC
On the pitch, Russia and Brazil both experienced disappointing World Cup campaigns in 2014. While Russia failed to emerge from a seemingly straightforward group, the Brazilians were humiliated by Germany in the semi-final. Off the pitch, meanwhile, both Russia and Brazil are also burdened by significant, and similar, problems: Like Brazil the infrastructure in Russia remains heavily out-dated, with much of the roads, railways and airports dating back to the time of the Soviet Union. Another similarity is size: The distances between the different host cities are immense, for example high speed train travel only exists between Saint Petersburg and Moscow; roads and highways are often in a precarious state; while internal flights are only recommended for travellers of an adventurous disposition. Fans and media would need to budget days rather than hours to make the 1500 mile journey by land from Russia’s Baltic enclave of Kaliningrad to the edge of Asia in Yekaterinburg.
Russia has promised to update its anachronistic railway and road networks, but perhaps ominously many such pledged projects made for Brazil 2014 never even started. Some that were eventually finished have been the subject of high levels of embezzlement, and constructional short cuttings, to the extent that some are not even safe for use.
I travelled to Brazil on the final weekend of the tournament to present a paper at the Fifth International Sports and Society Conference. Touring Rio de Janeiro, a taxi driver-come-political-commentator pointed out his window to unfinished “FIFA-Projects” as he called them, including a high-speed bridge connecting the airport with the centre of the city. This bridge is just one of many World Cup projects that have been completed to an unacceptable standard.
FIFA promised before the tournament that the people of Brazil would benefit from hosting the World Cup, because of the infrastructure projects that would modernise the country and be put in place in order to stage the tournament. Instead most of these projects have fallen flat, something that many fear will befall Russia 2018 as well in its ambitious, if not too far-fetched, infrastructural perestroika.
Russia’s Special Cost Factor
But Russia does not only have to look to Brazil for warnings about the perils of hosting a global sporting event. After all, the Sochi Winter Olympic Games were held in February 2014 on the country’s southern Black Sea coast with the experience leaving Russia with its own lessons to learn. These Games were already projected to be the most expensive Olympics of all time when Russia announced an initial budget of US$ 12 billion, however in reality the actual cost quadrupled to US$ 50 billion. Initially most of the budget was supposed to be contributed by private investors, but when this did not materialise to the extent envisaged, it meant that in 2007 the Medvedev administration had to intervene. Instead of private funding, the state, and to a large extent the people of Russia, footed a significant percentage of the bill.
A seven-year plan was introduced to guarantee the satisfactory completion of all facilities in Sochi. The government created Olimpstroi, a holding company, which acted as an umbrella corporation for all companies involved in the construction of tournament facilities. The company was given unlimited resources by the state and some oligarchs, a combination which consequently oversaw, reportedly, the largest embezzlement of government funds in Russia since the fall of the Soviet Union.
Russia’s World Cup 2018 budget stands at $18 billion, but after the exploding costs of the 2014 Olympics, and keeping in mind the customarily high costs of infrastructure development in Russia, it already seems safe to assume that spending will exceed that of the Sochi Games.
New World Cup Stadia –A New Stampede of White Elephants?
As was the case for Brazil, the construction of stadiums will also be a thorny issue for Russia. In the build up to World Cup 2014 reportedly slow and excessively expensive construction of football stadia became a recurring news item, with tens of thousands of Brazilian protesters venting their frustration at what they perceived as wasted public money. Of the $11.5 billion it reportedly spent on World Cup preparations (in fact the actual costs of the World Cup might be much larger), Brazil spent around $4 billion on stadia. Adding to the controversy, at least eight construction workers died during the building of the stadiums, and many were not finished on time. Indeed, when Brazil kicked off against Croatia, the crowd at the Arena de Sao Paulo was lower than hoped as one of the stands had not yet passed inspection.
It already appears that some stadiums in Russia are facing construction dilemmas. The new Kirov Stadium constructed in Saint Petersburg for example currently stands at a cost of $1.5 billion (three times the price of the Allianz Arena in Munich, a comparable facility). Despite construction having started in 2006 the stadium is not even close to completion. In order to save the project, the administration of the project was handed over by Gazprom to the municipal government. Russian stadium projects usually compare poorly to those built in Western Europe, with stadiums in Russia frequently at least twice the price of those constructed in Germany. The major reasons for this are bad management, poor accounting and alleged embezzlement of (mainly) government funds.
The Russian government has also been very aggressive when it comes to reacquisition of stadiums that were formerly under private ownership. The most prominent example of this is the famous Luzhniki Stadium in Moscow, which hosted the 2008 Champions League final. The former Torpedo Moscow player Vladimir Aleshin had owned the stadium since the national privatisation process of the early 1990s. But as part of the World Cup preparation, Aleshin’s company APS-Tsentr was given US$ 10 million by city authorities for his 58 per cent share of the stadium. APS-Tsentr later took legal action against the sale of the shares, stating that his company had been forced out of ownership.
Like the Kirov Stadium in Saint Petersburg, the Luzhniki in Moscow is to be completely renovated, and the current price tag for this lavish development stands at €1.2 billion. However legal battles, and the fact that construction has not even begun at this point, could see the costs of Luzhniki stadium spiral tremendously, surpassing the extortionate Kirov Stadium.
The Beautiful Blame Game – Can Russia Deal with World Cup Discontent?
As pointed out by leading Russian socio-political analysts from Moscow’s Carnegie Centre in January 2014, the extraordinary fact about the Sochi Olympics was not the high costs of the games, but rather the fact that only a generation after the fall of the Soviet Union the country was able to meet the financial demands of hosting such a global spectacle.
Like Brazil 2014, the social costs could be malignant for Russia. Much of Russia’s infrastructure outside the big cities is in dire need of repair. Furthermore, as Russia Today reported in 2013, the gap between rich and poor is still growing, state sponsorship of major tournaments has even further increased the wage gap, with many major construction projects handed to the oligarchical elite of the country at premium prices.
Brazil saw major demonstrations at the start of the Confederations Cup, a tournament that is used as a test run one year prior to the actual World Cup. Fuelled by the many perceived social injustices and the high costs of the tournament, students, displaced homeowners and poor people living in the favelas took to the streets to protest against FIFA and what they saw as obvious embezzlement of funds by the Brazilian government.
The protest movements, which began in the favelas in Brazil’s major cities such as Rio de Janeiro and Sao Paulo, soon spread through the entire country and became an inconvenient truth, not only for FIFA but also for the Brazilian government. The government responded with reprisals and demonstrations were notably minimised during the World Cup itself.
Raphael Santana, a student who attended some of the protests, described to me in Rio how the government would ensure that the protests would be kept to a minimum before the games: “The military police knew who the organizers were; they came in the early mornings before the games started, and arrested them.” The government used anti-terrorism laws to prematurely hold these people, who were thrown into the depths of Brazil’s prison system. As Santana went on to explain: “Prison in Brazil is not fun, some of my friends are now in the same place as murderers and thieves.”
Russia 2018 and the Lessons from Brazil
As described in our article “Boycott Russia 2018?” political protests could indeed pose a real internal threat for the political elite in Russia. At the same time, however, observers cite Putin’s high approval rating and the lack of social unrest during the 2014 Winter Olympics in Sochi as an example of public reluctance to protest on such matters.
Yet if Sochi is any indication, financial mismanagement of government funds will reach new proportions for the 2018 World Cup, and the mass mobilisation of anti-Putin voters after his 2012 re-election as Russian president showed that there is a lingering appetite for political protest in Russia. The World Cup, unlike the Winter Olympics, has much greater universal appeal and thus media attention.
With similar frameworks in terms of economics, politics, and social injustice, Russia will likely encounter at least some of the same problems that Brazil did in hosting the tournament. For the next four years, Russia’s World Cup preparation will be under close scrutiny from the world, much of which is already expressing its condemnation for Russia’s role in the conflict in neighbouring Ukraine.
Manuel Veth is a PhD candidate at the University of London King’s College, London. Originally from Munich, his thesis is entitled: “Selling the People’s Game: Football’s transition from Communism to Capitalism in the Soviet Union and its Successor States”. Follow Manuel on Twitter @homosovieticus