A stadium full of questions

Optics, priorities, logic, necessity – whichever metric of sound decision making you pick, there are some decisions which simply confound them all. In this regard the proposed development of a new international cricket stadium in the midst of a global pandemic – one that threatens not only lives but the global economy as a whole – seems particularly ill-advised.

In the best of times building a new sports stadium is a questionable proposition. Despite what many a politician may say, there is little, if any, economic upside to building one. In the US, for example, roughly 70 new major league stadiums were built in the 20 years prior to the 2008 financial crisis, at a total sum of $ 20 billion – half of which came from public coffers. As unemployment surged in Detroit, and New Orleans flooded due to a lack of investment in levees, one couldn’t help but think that that money might have been better spent elsewhere.

The argument frequently made in favour of building new stadiums is the employment domino effect. It’s theorised that jobs would be created through construction work on the stadium, and, beyond that, there is the hope that the area around the stadium would gradually become more populated with more people wanting to live there, thus leading to more businesses springing up.

For real world illustrations against this line of thinking, one need only look a little south towards Hambantota, where the Mahinda Rajapaksa International Cricket Stadium exists as shining beacon among white elephant projects. Built prior to the 2011 World Cup, the stadium has hosted a grand total of 28 matches, while the area around it has seen little development.

Further to this, projects such as these offer very little accountability; for example, if the stadium is predicted to generate economic benefits of Rs. 1 billion over a certain period of time, anything below that margin can simply be attributed to, say, the poor state of the world economy. 

Unsurprisingly the decision, which was announced this week, was met with a wide public outcry, prompting a swift clarification from Sri Lanka Cricket. In a media release, SLC sought to make clear that the entirety of the project would be privately funded, while putting forth the argument that the new stadium would allow Sri Lanka to meet the necessary criteria (five international stadiums) to host a World Cup on its own. The hosting of a World Cup, SLC believes, would bring in some much-needed foreign currency into the country.

It’s understandable why this would be an enticing proposition for the Government, however it fails to take into consideration the long-term ramifications. Even if we were to hypothesise a best case scenario where a COVID-19 vaccine is discovered and the world reverts to normal, is there enough cricket taking place in the country to recoup the cost of construction? With the new stadium in Homagama expected to be built at a cost of $ 30-40 million, the answer is an unequivocal ‘no’.

In the long run, a better utilisation of these funds would be in improving Sri Lanka’s domestic cricket structure – something many vested observers have called for several times over the years. Moreover, when the entire country is tightening spending, and preparing for the worst, the absence of a cogent argument makes the idea of a new international stadium one that should be dismissed out of hand on economic as well as moral grounds.