Host Cities: São Paulo
07 Jul, 2013
By Welligton Medeiros
Translation by Harriet Batey
São Paulo
Dear readers, today is this first instalment of a series of articles about cities which will host matches for the World Cup 2014. We will present the pros and cons of each city, as well as the infrastructure, public funding within projects and local repercussions of the events. We chose São Paulo as the first city to be presented as it will host the opening ceremony of the World Cup 2014. As such, Rio de Janeiro will be the last city within this series as the World Cup Final will happen there. The other articles will be presented in the following order Belo Horizonte, Brasília, Cuiabá, Curitiba, Fortaleza, Manaus, Natal, Porto Alegre, Recife and Salvador. We will address questions around the tournament with a critical eye towards public spending, but also separating public and private investment, which in some way will contribute to economic development. Happy reading!
About the city
Today, São Paulo is a global metropolis. The city has the best restaurants, hotels and commercial centres, along with countless sightseeing and business options. Currently, with a population of more than eleven million, the state capital hosts around 90,000 events each year. The city also has a huge cultural space, with many cinemas, museums, cultural centres, theatres and concert halls.
The Opening Stadium
After the FIFA’s veto of the Morumbi Stadium, the Corinthians home ground became São Paulo’s option for 2014. The carioca project office CDCA is providing 65,000 places in an area of 200,000m² in the Itaquera district. The site will have 3,500 parking spaces. The cost of the project is an estimated R$ 820million, overseen by a private contract. Work is being done by the Odebracht construction compant and is already 75% complete, and may be completed by October of this year.
Pros
The development, which in addition to the stadium includes shops and restaurants, will also revitalise the surrounding area, which is located in one the poorest regions in São Paulo, the East Zone. In terms of direct employment, the construction of the stadium
generated only 1,400 jobs and it is estimated that an additional 4,000 jobs will be created indirectly. Of the R$820million budget, R$400million will be financed by a BNDES loan (National Economic and Social Development Bank) and be paid by Corinthians in partnership with the construction company Odebrecht, whilst the remaining R$420million will be paid by a development fund of the São Paulo Municipality (Certificados de Incentivo ao Desenvolvimento).
The issuing of funds via Certificados de Incentivo ao Desenvolvimento for the construction of the stadium corresponds with a municipal law concerning Development Incentives, which is applied to any investment in “Zona Leste” (East Zone) of São Paulo, and is not directly paid by the government, but indirectly done so via tax amounts which will be received in the name of regional development. On 4th June 2013, the Advisory Board for Corinthians approved Parque São Jorge as financial collateral for the Caixa Econômica bank on requesting the R$400million loan from BNDES. The same financial institution conducted a survey and found that the land offered as collateral had a value of around R$1.2billion.
Cons
Since the approval of construction for the Corinthian’s Arena, many people have protested due to the fact that the city of São Paulo already has a stadium which is almost ready to receive the sporting event, that being the Morumbi. Many critics claimed that tourists will leave with a terrible image of the city and that there are many risks in using the Corinthian’s Arena which is located in a suburb of São Paulo.
Other questions have emerged of the role of the BNDES as a public institution, financing private stadiums. This is why the population is not happy with the systems of health, education, public security, public transport and infrastructure within the city and the government claims that they do not have sufficient resources for such improvements, whilst they continue to offer billions of public funds towards private projects. Is that enough reasons for you to take to the streets?
