WORLD CUP: Russia Will Only Experience a Short-lived Economic Benefit From Hosting The 2018 FIFA World Cup Tournament - MOODY'S Notes Against Russian President's Hope

Vladimir Putin, Russia's President
Photo Source: Channels TV

The number one man in Russia, President Vladimir Putin has raised his hopes considering the fact that the soccer World Cup which starts today will put his country in the international spotlight and will in turn, bring an economic boost in the country. As obvious as it has been over the years, the crisis in the economic sector has never ended and here is Russian President, raising his hopes for the economic status of the country. Experts, however, are downbeat about any long-term benefit. It is quite explicit over a period of time, that Russia will host the largest event on the footballing calendar from the 14th day of June till the 15th day of July 2018. Apparently, the tournament is being held in a handful of cities including Moscow, St. Petersburg and Sochi. The rate at which these cities will get busy in the next few weeks will get the minds of various individuals centred on these cities as it is the first time that Russia will host the Cup. It has however been reported by a reliable source that the Russian Government spent over $14 billion to host the tournament. And record has it that this competition is the most expensive in its history. Being the host, Russia will kick the tournament off today in a battle with Saudi Arabia, another nation undoubtedly known for its oil fields than football fields. Despising the home advantage, the Russian team is not expected to progress that far in the tournament. As the economy is not expected to get a big boost either.

Source: Sergei Bobylev\TASS via Getty Images

"Russia will only experience a short-lived economic benefit from hosting the 2018 FIFA World Cup tournament," Moody's Investor Service said in a report published last month that analyzed spending and projected gains from the tournament. "Much of the economic impact has already been felt through infrastructure spending, and even there the impact has been limited. World Cup-related investments in 2013-17 accounted for only 1 percent of total investments," Moody's added. Kristin Lindow, a senior vice president and analyst at Moody's, explained that the event will last just one month and the associated economic stimulus will pale in comparison to the size of Russia's $1.3 trillion economy. Russian media report that Russia will have spent a total of 883 billion rubles ($14.2 billion) on hosting the event. This is much more than the official cost of 683 billion rubles ($11 billion) with transport infrastructure ($6.11 billion), stadium construction ($3.45 billion) and accommodation ($680 million) being the most expensive items. The report by the Russian Media has it that the official budget for the tournament had been amended 12 times since Russia won the bid to host the Cup in 2010.