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Cape Town probably dodged a bullet when it lost the 2004 Olympic Games bid

Brij Maharaj
By Brij Maharaj
30 Jul 2024
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Although events like the Olympics do produce benefits, the international experience suggests that the ephemeral and exaggerated benefits privilege the elite at the expense of the poor; socioeconomic inequalities tend to be exacerbated; and the taxpayer picks up the astronomical bill.

Sport, which was once a form of entertainment based on ability and healthy competition and traditionally embodied a sense of honour, prestige and national pride, has now emerged as an essential political, social and economic force – for example, the competition to host the Olympic Games and Fifa World Cup.

A common argument is that such global sports events provide opportunities for local economic development and attract foreign investment. Although such events do produce benefits, the international experience suggests that the ephemeral and exaggerated benefits privilege the elite at the expense of the poor; socioeconomic inequalities tend to be exacerbated; and the taxpayer picks up the astronomical bill.

Organisations like Fifa, the International Olympics Committee and the Commonwealth Games Federation (which are not known for transparency and public accountability) have basically developed a franchise model that delineates the form and structure of sporting events in significant detail. Furthermore, as I have written before, the bidding country commits to absorbing any cost overruns, a guarantee that is like signing a blank cheque.

Read more: Olympic Games Paris 2024

There are many examples of cities still paying off crippling debt after hosting the Games. It has been argued that staging the Olympics is like an investment on the venture capital market: risky at the best of times, and potentially dangerous. Generally, bids for mega-events are promoted by influential, politically connected persons and groups in the private and public spheres who operate in abstraction from public accountability.

Under apartheid, South Africa was banned from participating in the Olympic Games between 1964 and 1992. As the world is gripped by Olympic fever, some South Africans may recall that in 1993, a decision was made to bid for the 2004 Olympics. Three cities – Durban, Cape Town and Johannesburg – submitted bids to the National Olympic Committee of South Africa to host the Olympic Games in the year 2004.

The Financial Mail of 23 July, 1993, reported that the three cities had similar bid objectives: “Putting South Africa on the map as the first African country to host the Games; the socioeconomic and sporting benefits; and the potential for job creation and income generation.”

The role of the Games in promoting non-racialism, nation-building, peace, social cohesion and unity in South Africa was stressed. While the government agreed to support the bid, it was aware of the political dangers of pledging enormous amounts of money on a project that could not be guaranteed to succeed.

Sober questions

The Financial Mail, as quoted above, posed some sober questions about South Africa’s ability to host the Games: “Do we, with our volatile politics and punch-drunk economy, have the resources to risk on an enterprise that has been unprofitable just about everywhere? Can we afford to be locked into a project that will be at the mercy of foreign sponsorships? ... the impression so far is that the campaigns of competing South African cities are characterised more by liberation enthusiasm than calculated risk analysis.”

Many considered Durban to be ideally suited to host the Games compared with Johannesburg and Cape Town, but its marketing campaign was seen to be low key. Johannesburg generated 60% of the country’s economic activity, and could host the Games with the least capital outlay. Cape Town was the first South African city to consider making a bid for the Games.

On 29 January 1994 the National Olympic Committee of South Africa nominated Cape Town as South Africa’s bid city for the 2004 Olympic Games because it had the “best potential to be marketed internationally”.

Cape Town came closest to producing a plan that would enable the Games to pay for itself. The Cape Town Bid Company functioned as a private business initiative. Supermarket magnate Raymond Ackerman initiated and directed Cape Town’s bid for four years. The private sector funded the cost of the bid (about R95-million). 

Improve infrastructure


In order to host the Games, Cape Town needed to improve its transport infrastructure and provide sporting facilities and accommodation, and the total estimated cost was R1.7-billion. The creation of world-class sports facilities would enhance the capacity of the city to attract global events. Forty percent of the contracts would be awarded to those from previously disadvantaged communities.

It was estimated that the Games would create 110,000 sustainable jobs, of which 85,000 would be outside the Western Cape region. The overall impact on the country’s GDP was projected to be in excess of R23-billion. The Games were expected to generate an income of R4.25-billion (at 1993 rates), with a profit of R1.3-billion.

There was concern that while there was a great deal of publicity about the advantages of the Games, the possible negative consequences were being ignored. The Coalition for Sustainable Cities, representing 35 trade union, political, environmental and development organisations, maintained that Cape Town’s Bid Company paid lip service to public participation, transparency and accountability, and that the benefits for the poor were exaggerated.

The International Olympic Committee’s evaluation report identified crime as a serious challenge to Cape Town’s bid. Other weaknesses of the bid included inefficient transport, questionable public support, budget and a shortage of accommodation.

Read more: In-Seine — unacceptable pollution levels force delay of men’s Olympic triathlon

As emphasised by then president Nelson Mandela in his address to the International Olympic Committee on 5 September 1997, Africa had never hosted the games: “We are in Lausanne and appear before you today to request that you enable Africa to host the first Olympic Games of the new century, to give the African march to the new future the great and unequalled impetus it needs and deserves.”

The attempt by Cape Town to use Mandela as a trump card failed. Also, most African delegates on the International Olympic Committee did not support the South African bid. A number of flaws were identified in the Cape bid: it had the wrong leadership; there were few black people involved in the bid at an executive level; the National Olympic Committee of South Africa had played an obscure role in the bid; lobbying with International Olympic Committee members was ineffective; and the government should have been more directly involved.

Compared with Athens, the winning city, Cape Town did not offer a stable economic and political environment, nor did it have the existing facilities. There is a view that Cape Town was included in the final five cities as an indication by the International Olympic Committee that it may soon be appropriate for the Games to be hosted in Africa.

Losing bid


There were also suggestions that Cape Town could “still reap global benefits” from the losing bid, and the most immediate was that it was marketed on the international stage as a global city.

South Africa subsequently hosted the 2010 Fifa World Cup. However, there were legitimate concerns that the escalation in the costs of the stadiums and infrastructure (without any public oversight) for Fifa 2010 resulted in the diversion of public funds from more urgent social priorities such as sanitation, housing, healthcare and education. By default, Durban won and lost the bid to host the 2022 Commonwealth Games. 

While acknowledging the costs and benefits, Daily Maverick’s Tim Cohen recently argued that “it’s a travesty that no African city has yet won the right to hold the Summer Olympic Games… Cape Town is one of the world’s great cities; it deserves a (second?) shot.” DM

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