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Saturday, June 1, 2002

Kansai firms hope the Cup runneth over

Windfall forecasts fuel optimism despite hotels' cancellation shock


Staff writer

OSAKA -- While economists debate the macroeconomic impact of the FIFA World Cup, which kicked off Friday, Hisako Tanigawa just hopes it will mean extra pocket money for her family.

"If we can do a good luncheon and dinner business, it will hopefully mean an extra 30,000 yen or so (when games are in Osaka). I told my son that if he helped out and we got a lot of business, I'd increase his allowance," said the 47-year-old owner of a small restaurant close to Osaka's Nagai Stadium.

Like Tanigawa, many in Osaka and elsewhere in the Kansai region hope the economic impact will be in the form of increased sales. And, according to the private Kansai Economic Research Center, local businesses have reason for optimism.

In the Kansai region, Osaka and Kobe each hosts two games in the first round and one game in the second round. The area's first game is between Russia and Tunisia in Kobe on Wednesday.

The center estimates the total economic impact of the World Cup to the region will be about 75.8 billion yen.

About half a million people are expected to visit the region in June. This includes all Cup-related personnel, the media and fans. Each person, the center predicts, will spend an average of 48,000 yen on hotels, transportation and food.

Of the 75.8 billion yen total, about 23 billion yen is expected to be spent by visitors at the stadiums and other World Cup facilities, while about 6.2 billion yen is forecast to be spent in restaurants.

Another 6.3 billion yen is expected to be spent on transportation, while approximately 7.1 billion yen will go toward accommodations.

The remaining 33.2 billion yen is expected to come in the form of a post-World Cup ripple effect, including spending by foreign visitors who may stay on after the final match has been played to visit Kyoto or the Universal Studio Japan theme park in Osaka.

But, while the numbers look good on paper, the real impact will probably be much lower than predicted.

"The 7.1 billion yen estimate for lodging was partially based on the assumption that over 40,000 luxury hotel rooms in Osaka would be needed during the World Cup for FIFA officials and official sponsors. This was the figure given by FIFA over a year ago," said the manager of an Osaka luxury hotel.

"However, in late April of this year, FIFA officials told us that, in fact, only about 20,000 rooms were needed."

Local hotels are particularly angry with FIFA because many set aside rooms that, they say, might have gone to visitors to the Universal theme park. With the last-minute cancellation of so many rooms, some wonder if there is enough time to make up for lost business. The exact reason for the cancellations is unclear, and FIFA didn't give a detailed explanation.

Local media speculate that many of the more wealthy visitors, or those who are on corporate expense accounts, may have decided to base themselves in Tokyo and travel to the Osaka and Kobe matches by bullet train.

Merchants around Nagai Stadium are hoping for brisk business, even if the official estimates may have been inflated. Despite prior talk of businesses closing during the World Cup matches in Osaka out of hooliganism fears, most shops have agreed to remain open in the hope that any foreign fans who come into their establishments are more interested in buying products than in wreaking havoc.

"At the end of the day, this is a really good business opportunity, Tanigawa said. "The economy of Osaka is really bad, so even the chance to do some increased business is welcome."



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The Japan Times

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