How Will the FIFA World Cup 2018 Impact Russia's Economy?

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    The upcoming soccer world cup 2018 will be hosted by Russia from June 14 to July 15 in 11 cities in the European side of the country.

    According to a Reuters report, its central bank is hopeful of a rise in jobs and demand for consumer products and services with a short-term positive impact on the Russian economy that has been growing after a two-year downturn.

    How Will the FIFA World Cup 2018 Impact Russia's Economy?

    A study conducted by McKinsey consultancy services revealed that the combined impact of the event would be around $15 billion on the country's GDP, "which exceeds the impact of similar championships in Brazil, South Africa, Germany and South Korea, and is second only to the result of Japan."

    Though the number sounds promising, the economic impact that it will create is very limited as per rating agency Moody's opinion due to the limited duration of the World Cup and a very large size of the Russian economy ($1.3 trillion). In fact, $15 billion is just 0.2 percent of Russia's annual output.

    "While the extra boost in tourism will benefit Russia's already healthy external accounts, the added support will likely be short-lived," it added.

    Local business to benefit

    Organisers of the World Cup said that they were expecting at least 600,000 international visitors, which is relatively low compared to the number Russia received in 2016. Nevertheless, 700,000 Russians are expected to attend these matches, which means the hotel and restaurants in the 11 cities will receive plenty of business.

    House renting sites like Airbnb is said to expect 177,000 visitors during the World Cup period and a random check of the prices on the website showed that the rent rates had tripled compared to the month of May, and the demand for these apartments are expected to increase by nearly 14 times the usual.

    Read more about: russia
    Story first published: Saturday, June 9, 2018, 16:52 [IST]
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