Zim sport on knife-edge

…Corporate, spectator interest diminish

PHILLIMON MHLANGA

Zimbabwe’s economic crisis is inflicting huge damage on the economics of sport in the country amid revelations institutions are on the brink owing to waning corporate and spectator support.

Most sporting institutions depend on revenue from the fans and corporate benevolence but, they are also suffering due to hyperinflationary pressures, which are ravaging the economy.

Apparently, spectator and corporate interests has diminished and this has huge financial implications, several sports administrators told BT Sport.

The problem is that gate receipts have suffered in recent times as attendance at games have gone down significantly due to low disposable income which has been eroded by a depreciating local currency after the government re-introduced the interbank market in February last year.

At inception, the local currency was trading at ZWL$2.5: US$1. But now, the Zimbabwe dollar has lost close to 600% of its value.

This week, the local currency was trading at ZWL$17: US$1.

Football administrators who spoke to BTSport this week but preferred not to be named, said the most popular sport by virtue of interest, football, has taken the biggest hit due to economic hardships.

The costs are huge for most clubs, and the outlook is bleak, they said.

“In most of the games last season, we recorded an average of 50 or less paying fans and the highest we recorded was when we played Dynamos at home, where about 3 000 fans paid to watch the game,” a chairperson of a Harare-based premiership club who preferred anonymity told BTSport this week.

“And the other state of play is that corporate sponsorship has suddenly taken a hit too in real terms.

The budgets we had at the beginning of the year were no longer making sense after government re-introduced the Zimbabwe dollar.”

The administrator said the club operated on a shoe-string budget.

“We have now resolved to recruiting junior players instead of going for seasoned and household names to cut costs. We have also resolved not to camp for games. It’s really tough for us,” the administrator said.

Another football administrator based in Bulawayo said: “The bottom line is that revenue has gone down, corporate sponsorship has also gone down. There is no question that the [economic] crisis has affected the economics of the sports.”

“Football is not recession proof. It’s just that clubs may not feel it the same way other businesses feel it but the economic crisis has hit us hard and this may mean that teams may also be less likely to go with long term contracts for players.

That’s a fixed cost and may want to stay flexible.”

Others said results of weaknesses in sport sponsorship commitments may become more evident after deals come up for renewal for the forthcoming season.

Overall, when corporate budgets are squeezed, marketing can be among the first areas to cut, especially brand marketing. This means, big corporate dollars will be harder to nail down.

Football fans are also hard hit as disposable incomes have been squeezed.

“Watching football these days is not cheap, that’s why many have been turned off,” one football fan told BTSport this week.

Efforts to get comment from Castle Lager Premier Soccer League chief executive officer, Kenny Ndebele and chairman Farai Jere, were futile.

They had not responded to enquiries by the time of going to print. Football is not alone in the abyss—golf, rugby and cricket— among others have also been hit by the biting economic crisis which saw the gross domestic product contracting by -6.5% in 2019, according to Finance Minister Mthuli Ncube.

The World Bank and the International Monetary Fund, however, say the Zimbabwe economy contracted by -7.5%.

This year, government is expecting the economy to grow by 3% against projections by the United Nations which see GDP contracting by -2.5% this year due to shocks such as drought, among others.

Golf, which has over the years tied its fortunes more closely to corporations, is now living with the consequences of the economic crisis.

Golf administrator and Zimbabwe Open Organising Committee chairman, Livingstone Gwata, said the sport was negatively affected by the worsening economic conditions.

Last year, sponsors pulled of Zimbabwe’s prestigious golf tournament, the Zimbabwe Open, due to deteriorating economic conditions.

“Golf clubs experienced incredibly high inflationary operating costs and subscriptions,” Gwata told BTSport.

“There is also scarce and erratic electricity supplies negatively impacted on the quality of fairways and greens.

The deteriorating and unpredictable foreign exchange and monetary situation last year resulted in the cancellation of the Zimbabwe Open Golf tournament as most sponsors found it impossible to budget for their category of sponsorship and attendant expenses.”

Zimbabwe Rugby Union president, Aaron Jani said: “We had no adequate funding due to challenging economic environment.”

The Sports and Recreation Commission was also forced to defer last year’s Annual National Sports Awards ceremony. These have now been moved to month end due to worsening economic conditions.

The nomination process was completed this week with the finalists unveiled yesterday.

A number of sport administrators spoke about depressingly poor prospects this year.

Zimbabwe is experiencing probably the most difficult economic conditions since 2009, when the country ditched its defenceless Zimbabwe dollar due to hyperinflationary pressures.

Most people’s real incomes have been in serious decline.

Since February last year when government liberalised the foreign currency market, most people have experienced small or non-existent rises in earnings while annual inflation rate has been well above 500%, according to independent economists who continued to calculate the rate after Ncube banned the publication of annual rate of inflation.

These conditions are unprecedented since 2009.

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