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The relationship between the economy and sports has grown rapidly in the last few years. Investment in sports facilities has greatly improved the quality of sporting projects and talent sponsorships.
The Dubai Sports Council, a leading establishments in this field, concluded its third forum last week, after discussing many issues related to activities, finance and commercial development of sport at a regional level.
The topics discussed during the 3rd Dubai International Sport Conference clearly reflected the developing relationship between sport and the economy.
The conference concentrated on financial experiences, such as the issue of commercial thought in running sports clubs, transforming the public into commercial clients, investment, sports industry revenues and TV channels.
Investing in sports leads to the development of other important sectors, such as tourism, retail, transport and communications. GCC countries have in fact established sports cities and hosted international events such as the Asian games and the Formula 1 races.
The relation between economy and sports is not new. Many sports clubs in Europe and North America have been transformed into trade establishments, with stocks traded in international markets bringing in big profits.
The situation in the region is somewhat different. Sports clubs depend almost totally on the state for their finances. Clubs are unable to finance themselves.
The Dubai Conference called for changes in the financial and commercial aspects of the region's sports establishments. It called for developing internal income sources, through building commercial institutes, initially with the state's assistance, or through sponsorships, which yield hundreds of millions today.
The conference discussed the issue of a local company offering Dh20 million to sponsor a sports activity. It also discussed the dealings of some banks and local financial institutes in this context. Such endeavours can help clubs turn into commercial projects without affecting the ethics of sport.
Similarly, we find the current Euro 2008 soccer championship in Switzerland and Austria offering a high level of skill and sportsmanship. At the same time, the championship will generate $2,000 million for both countries.
Such a transformation in the Arab region, though complicated, will need serious effort. It is also very important for the development of sports and its' internal self-funding. Relying on the state for financial support is temporary, and is bound to the fluctuating oil prices.
Gulf Cooperation Council (GCC) countries are fundamentally changing the structure of their annual budgets to reduce their responsibilities and follow financial policies in line with modern economies built on social participation and partnerships.
This new attitude is in the context of finding sustainable sources to fund annual budgets and developing quality services.
Clubs and sport establishments are also included in this transformation, but the whole process is slow.
Sports establishments have to be prepared for the coming changes.
The Dubai Sport Conference is a first initiative of its kind in the Gulf. The economic and financial revenue in the field of sports is huge. It is likely to positively affect many allied economic and athletic activities.
Hence, it is important to develop a mutually beneficial relationship between sports and the general economy to balance the two parts of the equation.
The writer is a UAE economic expert.
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