Brazil: Nationwide Rioting and Police Strike, World Cup Might Not Even Happen

CofCC
May 22, 2014

World Cup 2014 is only weeks away and now Brazil’s own national team is denouncing the government for corruption related to unfinished stadiums.

Brazil pledged to build twelve new stadiums. A move that was heavily criticized by the public. However, at least six of them are unfinished.

In fact, only 36 out of a total of 93 World Cup related projects are actually finished.

Protests over the spending have been going on for months. However, huge violent protests have exploded across Brazil for the past several days.

From Reuters…

When Adilson Ferreira hoped for big crowds during the World Cup, this wasn’t what he had in mind.

Starting last June, protesters angry about the money Brazil is spending to host the soccer tournament have regularly marched outside the small restaurant he manages in downtown Rio de Janeiro. One night, they smashed the windows and even destroyed the espresso machine.

Instead of hiring extra workers during the Cup, as he once planned, Ferreira is now focused on how to limit the damage.

“We need the World Cup to be a success on and off the field so everyone can win from this,” he said.

Expectations that the World Cup might bring a big boost to Brazil’s economy have been replaced by more sober forecasts and fears that street demonstrations and other problems could chase away business and tarnish the country’s image among investors.

President Dilma Rousseff’s government estimates the month-long event, which starts on June 12 in Sao Paulo, could add over half a percentage point of economic growth this year and more than half a million jobs.

Economists are, on average, more conservative. They see a boost closer to 0.2 percentage points, according to a recent Reuters poll.

The economy is expected to grow just 1.6 percent this year, putting pressure on Rousseff as she seeks re-election in October.

“It would be worse if we didn’t have the Cup, but the tournament will not save our economy from a pretty bad year,” said Fabio Bentes, economist with the National Confederation of Commerce, which represents retailers and service companies.

It’s a long way from the euphoria of 2007, when Brazil was awarded the right to host the tournament, which its team has won a record five times.

Back then, politicians said the Cup would showcase Brazil’s long-awaited arrival as a major economic power and provide a good reason to completely transform its dilapidated airports, highways and other transport infrastructure.

However, only about $7 billion of the $11.7 billion in planned investments for the Cup have been executed, according to the Office of the Comptroller General, a shortfall that most analysts blame on poor planning and red tape. Nationwide only 36 of 93 major projects have been finished, says Sinaenco, a trade group of engineers and architects.

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