A British economic expert has warned England’s early exit from the Rugby World Cup could cost the country more than $8 billion.
The impact of the 33-13 defeat stretches far wider than Stuart Lancaster’s team who won’t be involved in the play-offs.
Being the first hosts to miss the business end of the tournament looks dire for business.
The massive loss of revenue was forecasted for the entertainment and food industry but stretches to broadcasters and the stock market.
Not having the home nation involved will hit pockets right around the country. The Twickenham clash with Australia was billed as “the $1.2b match” for the hospitality industry if England could win and stay in the tournament.
That has now gone down the drain.
Martin Caffrey, director of the Federation of Licensed Victuallers Association, said:
“This will see a massive loss of business. England games are a big, big bonus for our members because people come in to watch the games,” Martin Caffrey, director of the Federation of Licensed Victuallers Association, told the Mirror newspaper.
“It is a similar impact when our football team go out at the World Cups. It equates to a huge loss of revenue.”
Host broadcaster ITV is also looking at a disaster. England games were estimated to be worth around $2.35m each in added advertising revenue.
But the biggest impact was likely to come to the British Stock Exchange when it reopened for business on Monday.
Alex Edmans, of London Business School, told the Mirror newspaper his calculations could see $7b off shares wiped out.
“A lost competition can have a profoundly negative effect on investor mood,” Professor Edmans, who has studied the impact of elimination from major sporting tournament on the stock market.
His research is based on similar trends in football tournaments in France, Germany, Italy, Spain, Argentina and Brazil.
He believes England’s loss could lead to a next-day decline of 0.15 per cent in share values.
The last three Rugby World Cups have seen the hosts reach either the semi-final or final.
Tournament organisers were putting on a brave face, pointing to the record ticket sales that included nearly all tickets already being sold for the knockout stages.
There will clearly be surge on the secondary ticket market as some England fans look to offload playoffs tickets bought in anticipation of their team being involved. – [Stuff]