South Africa plans to spend 15 billion rand on World Cup

Wednesday, October 25th 2006, 9:03 am

By: News On 6

CAPE TOWN, South Africa (AP) _ The South African government plans to spend 15 billion rands (US$1.9 billion, euro1.5 billion) on stadiums and infrastructure for the 2010 World Cup, Finance Minister Trevor Manuel told parliament Wednesday.

He said preparations for the soccer showcase _ the first to be held on African soil _ was one of the country's top spending priorities for the next three years.

``The hosting of the 2010 FIFA World Cup provides South Africa and the region with a one-in-a-generation opportunity to showcase our land and our hospitality in a sporting festival that knows no bounds,'' Manuel said in presenting his medium term budget through to 2009-2010.

``Hosting this event will require the effort of all South Africans,'' he told parliament. A delegation from the soccer authority FIFA was in the gallery.

Manuel said the government would boost spending by 80 billion rands (US$10.3 billion, euro8.2 billion) over the next three years. In addition to the World Cup, he said emphasis would be placed on beefing up the criminal justice system and recruiting an additional 10,000 police officers to help tackle rampant crime.

He also outlined greater investment in housing, sanitation, transport and electricity to improve the lot of South Africa's poor, who have so far seen little improvement to their daily lives since apartheid ended and multiparty democracy was ushered in 12 years ago.

``In celebrating the solid performance of our economy, we must continue to be mindful that there are still too many South Africans who go to bed hungry, too many who start at the fragile walls of their shacks and far too many for whom disease makes life a daily struggle,'' he said.

Manuel said government spending would rise from 474.2 billion rands this year (US$61 billion, euro48 billion) to 644 billion (US$83 billion, euro66 billion) by 2009-10.

Manuel said South Africa _ the powerhouse of the continent _ could increase spending because of sustained economic growth thanks to sound fiscal and monetary policies over the past few years. Economic growth was expected to accelerate to 5.3 percent by 2009, up from 4.4 percent in 2006. Over the next three years, inflation is expected to average 4.8 percent, he said.

Tax revenues have also exceeded all expectations, with revenues this year alone some 30 billion rands (US$3.7 billion, euro3 billion) more than expected, he said.

``As South Africans we have reason to feel exceedingly proud of our collective achievements,'' he said.

The government hopes the World Cup will leave a lasting legacy for South Africa, and in particular jump start its struggling transport system.

The transport ministry has started upgrading the nation's airports to cope with the anticipated 450,000 foreign tourists expected to flood into the country. It is spending 5 billion rands (US$640 million, euro550 million) to improve the railway network and nearly 8 billion rands (US$1 billion, euro840 million) to modernize the fleet of aging and often dangerous minibus taxis which form the backbone of the transport system.

Manuel said of the additional 15 billion rand spending on the World Cup, 8.4 billion rands (US$1.1 billion, euro850 million) was to build or upgrade 10 stadiums and the rest for infrastructure around the stadiums.