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South African government backs Rugby World Cup bid with financial guarantees

The South African government has today (Thursday) formally backed the country’s bid to host the 2023 edition of the Rugby World Cup.

The country’s cabinet has approved a request for financial guarantees of R2.7bn (€171m/$203m), which was required from World Rugby as a prerequisite for hosting the national team event.

SA Rugby, the sport’s governing body in the country, welcomed the move and thanked the government and South Africa’s Minister of Sport and Recreation, Thulas Nxesi, for their support in providing the necessary guarantees.

A lack of government backing had previously clouded South Africa’s ambitions for the 2023 World Cup. In April 2016, the country’s then Sports Minister, Fikile Mbalula, banned SA Rugby, Athletics South Africa, Cricket South Africa and Netball South Africa from hosting and bidding for international events over failings in meeting racial transformation targets in their respective sports.

In May, however, the path was cleared for SA Rugby to submit a formal bid as a result of the latest report by the Eminent Persons’ Group (EPG) – set up by the Ministry of Sport and Recreation – to monitor the pace of transformation in sport. The report reversed the ban on SA Rugby bidding for, and staging, major events.

South Africa staged the 1995 World Cup and has since bid for the 2011, 2015 and 2019 editions of the event.

Following today’s pledge, SA Rugby chief executive Jurie Roux said: “They have been supportive of the bid for every step of the process but this is a big moment to share a stand with government on our shared vision. We’re very grateful to Mr Nxesi, the director general, his department and the entire government.

“It would be a marvellous, inspirational nation-building moment to recapture some of the excitement of 1995, but it would also have enormous practical benefits for our country.

“Hosting the Rugby World Cup in 2023 would have a R27bn direct, indirect and induced economic impact on South Africa; R5.7bn would flow to low income households; 38,600 temporary or permanent jobs would be sustained and there’d be an estimated R1.4bn tax benefit to government.”

South Africa’s Sports Ministry said in a statement: “Cabinet has approved the overall proposed package for this tournament which is an economic bid which would minimise the demands on the fiscus as well as stimulate economic activity, employment and empowerment.

“The tournament will contribute to stimulate our economy by supporting government priorities, especially as it relates to preferential procurement and adherence to the Sport Transformation Charter and the sharing of the profits derived. The event will further boost our tourism and hospitality sector.

“A successful bid will be a win-win for sport development, for the economy and for the nation as a whole.”

South Africa faces competition from Ireland and France in the race to stage the 2023 Rugby World Cup. World Rugby will announce the host nation on November 15.

Earlier this week, the French Rugby Federation (FFR) presented World Rugby with more than €400m ($465.7m) of “firm, unconditional and irrevocable” financial guarantees for its bid to host the 2023 World Cup.

The guarantees are split into two parts, with the first, underwritten by the French state, being for €171m. The FFR said this was greater than the sum expected by rugby union’s world governing body and will largely be covered by its projections of €477m in revenue generated by the tournament.

The FFR said the second financial guarantee is provided by a “major French private bank” to cover commitments on organising costs of the tournament. This amounts to €236m.