John McCarthy
WASHINGTON — The Caribbean’s inaugural hosting of this year’s Cricket World Cup has been a boon to the region’s economy, but the party may end in a debt and fiscal hangover, the International Monetary Fund said on Friday.
Caribbean governments have spent about $250 million (126 million pounds) in the past two years to build five new stadiums and upgrade others in the nine countries hosting the March 5 to April 28 contest, with further spending on roads, airports, hotels and marinas.
“Partly as a result of this expenditure, primary balances have deteriorated in most countries, and average public debt remained over 100 percent of GDP at end-2006 in host countries,” the IMF said in its semiannual regional outlook.
South Africa, host of the 2003 Cricket World Cup, and Japan-South Korea, venues for the 2002 FIFA World Cup, saw small long-term net positive effects from their sporting events, the Washington-based multilateral lender said.
But the consequences for the Caribbean are “unclear, especially in light of the associated fiscal cost,” it added.
“There is concern that the net effect of the CWC could well be negative in light of its heavy fiscal costs and already high public debt burdens in the region,” the report said.
“In general, Caribbean public investment has shown a relatively weak link with growth, suggesting the need to increase the efficiency of these outlays,” it said, adding that the Caribbean’s long-term growth prospects hinge on marketing itself as a tourist destination.
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