Table of Contents

Part 2: The WSSD

SECTION ONE: DATA COLLECTION

In order to achieve the aims of the study, it had been necessary to undertake extensive primary data collection in the form of surveys. These actions are discussed below.

1.1 Delegate Survey

Face-to-face interviews were conducted with delegates that were selected by means of a judgemental quota sampling method. The ideal for a representative sample is a simple random stratified or systematic random stratified sample, which was however not possible. BMR staff members used pre-structured questionnaires during interviewing, and questions related to aspects i.e. the group represented by the delegate, a breakdown of expenditure, and length of stay, satisfaction with services and country of origin. The interviewing was done at the Ubuntu Village, NASREC as well as on the shuttle buses between the parking spots and the Convention Centre at Sandton. A total of 422 delegates were interviewed, which had been more than the original target of 400 delegates that had been agreed upon. No interviewing was allowed at the Convention Centre.

With exception to the media delegates, the interviews that have been conducted are regarded as representative of the number of delegates accredited. During data transformation, the main assumption was that the amounts of accredited delegates were correct; the rest of the information was primary data.

1.2 Parallel Events

There were approximately 500 parallel events associated with the aims and objectives of the WSSD that were held outside of the Sandton Convention Centre before, during and after the Summit dates of 26 August to 4 September 2002 (Department of Environmental Affairs and Tourism, 2002). These events were convened and managed by organisations or groups independent of the United Nations. A table consisting of all relevant information about the events were supplied by JOWSCO, and incorporated into an inventory. The classification was based on the main theme of each event and was done to make the data collection process easier.

During the data collection process, there had been no sample taken and all of the events were contacted. The type of information requested related to predictions about the amount of people that were expected to attend the event, money that delegates would spend while taking part in the event, the amount of investment that were put into the event as well as other sources of funding and the amount of that funding.

A number of problems made the data gathering process extremely difficult, and one of the most prominent problems was making contact with events managers from the international community. During the summit itself, it was very difficult to come into contact with the events managers due to the fact that they were concentrating on the operations of their events, and it was believed that they would assist in the study after the conclusion of the Summit. A number of reminders had been sent to these managers after the completion of the WSSD. There were approximately 500 events that were planned to take place, but six of these were cancelled. Approximately 10% of the events supplied information and assumption based on this had been incorporated into the economic impact assessment model.

It has come to light that some of the events managers felt that there might have been miscommunication as they had been expecting more from their involvement with the WSSD as a parallel event. They were under the impression that the marketing of their event were not their responsibility, and it had been suspected that there was not sufficient advertising of the different events. The overall impression indicates that more visitors had been expected, and it might also be wise to formalise visits to the parallel events to ensure that the target market is reached.

1.3 Additional Sources

The Government Departments as well as JOWSCO assisted the consultants to gather relevant information from the people and institutions that participated in the WSSD.

SECTION TWO: SUMMIT AS ECONOMIC STIMULUS

There are various factors that influence the economic impact of the WSSD on the South African economy. Many of the arrangements required a fair amount of investment that in turn led to a very specific contribution to the South African economy. In order to explain the economic impact of the WSSD in a realistic and accountable manner, it is necessary to take note of the arrangements that formed part of the WSSD in order to get a holistic view of the Summit and the financial implications it had. It is also important to take note of various projects and initiatives that had been created and implemented due to the hosting of the WSSD, and although in some cases not directly contributing to the WSSD, it did raise awareness amongst people about sustainable development.

2.1 Logistical Arrangements

Once South Africa had been awarded the bid to host the WSSD, the South African government represented by the Department of Environmental Affairs and Tourism (DEAT) set up the Johannesburg World Summit Company (JOWSCO) to manage and arrange the logistics of the Summit (Earth summit, 2002). JOWSCO was a not-for-profit company established in terms of Section 21 of the Companies Act of 1973, subject to Schedule 3 of the Public Finance Management Act of 1999. It is not an independent company only an extension of the South African government. The remainder of the current section makes reference to the functions that JOWSCO had for the duration of the WSSD.

2.1.1 Accommodation and Travel Arrangements

One of JOWSCO's key responsibilities had been to assist with travel, accommodation and tour arrangements for the people expected to attend the United Nations Heads of State Summit at the Sandton Convention Centre and the Civil Society Global Forum at Nasrec. To this effect, JOWSCO initiated a public tendering procedure whereby they appointed two private sector consortia with strong empowerment credentials to manage travel and tour arrangements for the delegates during the WSSD. The Global Conference Destination Management Company (DMC) was responsible for co-ordinating travel and accommodation bookings while Lefase Tour Co-ordinating Company co-ordinated the pre, during and post Summit tours.

The DMC secured more than 53,000 hotel rooms in Gauteng and made these available for bookings to the delegates. During the Summit, three types of tours had also been provided by the DMC with the outcomes set out in Table 1.

Table 1: Tour packages provided by DMC

The Greening Tours were tours related to Sustainable Development, the Media Tours were more focussed on the marketing of South Africa to the rest of the world. From the statistics included in Table 1 it is clear that a total of R690 000,00 had been generated by these tours.

Lefase offered selected tour packages that had been approved by the JOWSCO Tourism Advisory Committee by means of a set of "sustainable development" criteria, i.e.:

• Adherence to minimum requirements of the Tourism Grading Council and various industry bodies
• Innovation and uniqueness
• Environmental best practice
• Competitive pricing
• Black economic empowerment credentials
• Support for small and medium size enterprises, and
• Skills transfer

Some of these tours were based in South Africa, but some also exposed the delegates and other participants to various Southern African countries. Delegates took part in several of these tours, and the income generated by these, amounted to approximately R2 300 000,00 (Abela, 2002).

Four of the 20 hotels and bed and breakfast (B&B) establishments interviewed indicated that they made additional investments in anticipation of delegates from the Summit staying at their establishments. The above investments varied from R13 000,00 to R60 000,00. The number of additional staff employed by the four hotels and B&Bs varied from 3 to 15 with an average of 9.

A total of 672 people registered with DMC as homestays. These were segmented into 11 zones. One interview was conduced in each of the eleven zones except Zone 1 where three interviews were conducted because a significant number of the addresses fell into Zone 1. Seven of the 13 homestay respondents indicated that they had made additional investments such as renovating the house, fitting new carpets, upgrading kitchens and purchasing new furniture. The average amount spent lies in the vicinity of R3 000,00 for those who made new investments. All in all, four people were hired on a temporary basis by homestays interviewed during the Summit. Eleven of the homestay owners indicated that their expenditure increased during the Summit while only two had additional income. The last two mentioned were the only two that had visitors who were here for the Summit. Only 15,4% of homestay owners benefited from the Summit.

Delegates were asked to indicate the type of accommodation that was being used for their stay in South Africa, they had to indicate the average number of days as well as the average rate per day. The results of those who answered (381 respondents) are shown in table 2. The estimated total is inflated to a total of R621,8 million for all delegates. The distribution by type of accommodation is based on the results of the question in the questionnaire.

Table 2: Information related to accommodation

Source: BMR surveys. 2002

2.1.2 The Ubuntu Village

JOWSCO had also arranged for the Wanderers stadium to be temporarily transformed into a logistical hub and exhibition space called Ubuntu Village.

It had been arranged in such a manner that the delegates and other participants could enjoy various forms of entertainment while interacting with other stakeholders at the Ubuntu Village. The main focus had been Tensile one, the largest moveable event venue in the world it provides 11,000m² covered space and it has only been put up to the full extent on two previous occasions. A number of the parallel events had also been located at this venue.

According to statistics that had been collected during the WSSD, a total of 283 500 people had visited the Ubuntu Village. The visitor number can be broken down, with 13 500 people visiting per day, 51 529 tickets were sold through computer tickets which was valued at R1 122 822,00. It should however be kept in mind that this figure is not an accurate display of consumption. The following influences the figure:

• Every day 3 000 workers entered the village
• People could have entered, exited and re-entered the village numerous times during the same day
• A section of the village had been open to the public, and due to the fact that it had no cost implication there had been no manner of keeping track of people entering the village.

2.1.3 Nasrec

Another venue that was utilised during the WSSD, had been the Expo Centre (Nasrec). This venue has almost 42,000m² of covered space as well as 11,000m² outdoors space, and an 8 000-seat amphitheatre.

Information supplied by the WSSD Civil Society Secretariat (Ismail, 2002) indicates that of the total number of delegates registered at Nasrec (24 760) approximately 8 645 were local delegates. A total of R178 million was invested into the 924 meetings that were held during the summit, with daily expenditure per delegate estimated at R790,00 (including accommodation, transport and meals).

2.1.4 WSSD Events

It is thus clear that there had been different events held for the duration of WSSD with the main events being held at the Sandton Convention Centre. It is situated in the heart of Africa's most advanced business and technology hub, also regarded as being the most environmentally advanced and has the capacity to host 6 000 people (JOWSCO, 2002). The multi-purpose media centre had been housed at the Sandton Convention Centre and it had been regarded as the world's window on the Summit with access to a full range of production and telecommunications options (JOWSCO, 2002).

Together with the main events in the Convention Centre, a total of 33 side events took place inside the Centre and all delegates that were accredited to the Summit were welcomed there. It had been believed that the side events was an important part of the meetings of the Commission on Sustainable Development (CSD) and were expected to be similarly important in the WSSD and the meetings of the Preparatory Committee (PrepCom) (UN, 2002).

Additionally, approximately 500 parallel events were held in 75 different venues all over South Africa before, during and after the WSSD. The diverse venues included areas such as Cape Town, Durban, Pretoria, Johannesburg, Soweto and Alexandra to name just a few. These events were associated with the aims and objectives of the Summit. The main strategic parallel events were:

• Civil Society Global Forum
• Business Forum
• Local Government Session - Local Action Moves the World
• Ubuntu Village and Exhibition
• Aspiration and Reality: Building Sustainability
• Waterdome - No Water, No Future
• Forum on Science, Technology and Innovation for Sustainable Development
• Parliamentary Workshop on Clean Air and Clean Water
• Summit Institute for Sustainable Development
• Implementation Conference
• Indigenous People's International Summit in Sustainable Development
• International Youth Summit and African Youth Summit
• Environment Centre
• Global Judges' Symposium

2.1.5 Accreditation

In order for delegates to attend the various events that were held, they had to go through the accreditation process to ensure that they have permission to attend. Clearance had been required for any of the official United Nations activities, and if either United Nations Economic and Social Council (ECOSOC) or the CSD (UN Commission for Sustainable Development) had already accredited an organization the process had been very simple.

There had been two phases to the accreditation process and during phase one, accreditation of all UN delegates, government and media representatives to the WSSD had been handled by the United Nations through a formal process. Accreditation to the Civil Society Global Forum, the Business Action on Sustainable Development and the Local Government Sessions were handled directly by the organising teams of these forums (JOWSCO, 2002). Phase 2 of the accreditation took place once the delegate arrived in Johannesburg and took possession of the accreditation card.

More detailed information regarding the number of delegates (both national and international) that received accreditation is dealt with in a later section of this document.

2.1.6 Employment

It should be noted that the employment figures that are set out in this section only refers to the employment that had been created for volunteers to help out with the activities surrounding the summit. Additional employment had been created, but this is dealt with at a later stage in the document.

Due to the variety of activities that were arranged for implementation during the WSSD, it had been necessary to train 3 500 volunteers. Despite the fact that the volunteers were not going to be remunerated, JOWSCO processed over 17 000 applications. The volunteers did however receive a R75 daily allowance, a meal voucher as well as free access to the Summit transport system. The volunteers had been divided into two service groups:

• The SA host group - 1 000 of the volunteers interacted with the delegates directly at places such as Johannesburg International, Summit venues, hotels, transport and the Ubuntu Village
• The rest of the volunteers were placed at information kiosk, the immigration help desk, call centres and translation services.

The volunteers were mainly from Gauteng, and despite the magnitude of applications the choices had been made based on certain criteria set by the UN, one of them being that volunteers should be able to speak the six official UN languages (French, Russian, Spanish, Mandarin, Arabic and English). The final employment numbers were the following:

• 1% senior citizens
• 2% disabled
• 60% females
• 97% unemployed
• 40% men
• 3% were people that had gainful employment

Even though the volunteers did not receive payment for their services during their involvement with WSSD, the opportunities afforded to them by their involvement alone gives them improved skills that could lead to greater employability. That is intimately connected to the concept of sustainable development - teaching people appropriate skill to enable them to become part of the economic market and formal employment.

2.1.7 Media

The South African Broadcasting Corporation (SABC) had been the host broadcaster during the WSSD and provided a range of broadcast services at the Broadcast Village at the Sandton Convention Centre. Pool cameras had also been located at various points inside and outside the venue. Rushmans had been appointed by JOWSCO to manage the media logistics for the WSSD, and their role included liasing with all media representatives, ensuring that requirements are considered and assisted in the management of the media facilities.

The main media centre had been located on the exhibition level of the Sandton Convention Centre with the Sandton library available for workspace. Other media facilities had been made available at the following venues:

• Civil Society Global Forum - Expo Centre (Nasrec)
• Ubuntu Village
• The WaterDome
• Business Week (located at Gallagher Estate)
• Newtown

2.1.8 Transport arrangements

Another aspect that received consideration in order for the WSSD to function efficiently had been the need to provide the correct type of transport infrastructure. To facilitate this, R76 million had been invested in upgrading roads in and around Sandton, and attention had also been given to the sewerage system, faulty traffic and streetlights.

MetroBus acquired 200 state-of-the-art busses that were leased to CBT Coaches to ferry delegates from one venue to another, entertainment facilities and cultural activities. The taxi community had also been included during the WSSD and 400 hundred taxis and 800 drivers had been accredited to serve delegates.

Taxi operators welcomed the opportunity to be involved in the WSSD and many opportunities arose from this. The different taxi associations spoke to each other for the first time in order to work together. The operators received training in defensive driving, customer relations and protocol.

Delegates that purchased a "Welcome SA" card were entitled to use a shuttle bus service between the 12 major "hubs" in the greater Johannesburg and Pretoria areas. JOWSCO had put together a transport grid to cater to the expected delegates. The grid was designed in such a manner as to transport up to 30 000 delegates within two hours to special events. Shuttles operated between all accommodation zones, Summit venues and Ubuntu Village. Ubuntu Village also acted as the transport interchange for the WSSD. The transport had been available to all support staff, exhibitors and participants.

2.1.9 Corporate sponsors

In order for JOWSCO to ensure that all the logistical arrangements were handled in an efficient and effective manner, the appropriate funding requirements had to be met. A certain amount of funding had been transferred from governmental departments and various sources, but there had been a number of corporate sponsors that contributed generously to their work. These sponsors were:

• Hewlett-Packard:
  HP had been the exclusive worldwide technology partner for the World Summit on Sustainable Development. HP provided infrastructure technology, support, services and website solutions.

• DaimlerChrysler:
  DaimlerChrysler, Official Transport Partner to the World Summit on Sustainable Development, has handed over 1 050 Mercedes-Benz vehicles to accredited drivers whose responsibility it was to transport visiting heads-of-state delegations over the Summit period.

• MTN:
  MTN had been the exclusive telecommunications partner of the Johannesburg Summit, supporting the JOWSCO to the tune of R5 million as well as telecommunications operational support. MTN also sponsored the Summit's Info Line.

• Standard Bank:
  The Standard Bank Group, one of the largest financial institutions in South Africa, was the official banking partner and one of the first national corporate partners of the Johannesburg Summit.

• South African Post Office:
  The South African Post Office had been appointed the official mail facilitator for the host country of the World Summit on Sustainable Development.

• Murray and Roberts:
  Murray & Roberts is proud to associate itself with the Johannesburg Summit as an important global event.

• Anglo American plc:
  Anglo American is delighted to be associated with the Johannesburg Summit and to support the government and South Africa in hosting this exciting event.

• IDC:
  The Word Summit on Sustainable Development offered the IDC "the opportunity to directly and indirectly engage and network with our peers, heads of state and government, business, academics, economists and other players and eminent persons, learn from them, and share our own lesson of experience".

• Eskom:
  Eskom is proud to announce its strategic partnership with the Johannesburg World Summit Company. It says its contribution signifies support for the World Summit on Sustainable Development. A key theme of the Summit is poverty alleviation, which is aligned with Eskom's intent to be Africa's pre-eminent, globally competitive energy and related services supplier.

• South African Airways:
  SAA served as the carrier of choice for the Johannesburg Summit.

It should be noted that all the logistical arrangements required funding to be channelled into specific areas of the economy, and the following section aims at supplying detailed information regarding investment.

2.2 WSSD-related activities

Various organisations, private business and government (South African as well as international) had been involved with the funding related to the WSSD. The funding received from the various sources had been applied in a specific manner, leading to a specific impact on the South African economy.

This sub-section sets out the funding that had been received and injected into the economy with regard to the WSSD. With regard to the government departments, Table 3 sets out these contributions.

Table 3: Central and Provincial Government expenditure and transfers to JOWSCO

From the Table 3 it is clear that the Government Departments invested a total of R239 534 000,00 into the WSSD. An additional total of R312 100 000,00 was transferred to JOWSCO.

Apart from the funds that had been transferred to JOWSCO by the various departments, it also had additional funding. Table 4 sets out the Donor and Sponsorship funding as well as value added by JOWSCO.

Table 4: JOWSCO: Donor / Sponsor Funding and value added

Source: JOWSCO, 2002

From Table 4 it is clear that the additional donor funding and other monies raised amounted to R301 122 439,00 of the JOWSCO budget.

2.2.1 Greening the WSSD

An important initiative that had been implemented before, during and after the WSSD is the Greening the WSSD. This initiative had been launched on 23 May 2002 in a first attempt to organise a major United Nations Summit in an environmentally friendly way in order to ensure that the WSSD brings real benefit to the people of Gauteng (Greening the WSSD, 2002). The initiative aimed at ensuring that the WSSD was hosted in a way that demonstrated environmental best practice while countering the impact of the expected delegates on Gauteng's natural resources. Funding for this initiative is set out in Table 5:

Table 5: Funding for the Greening the WSSD initiative

Source: Fakir, 2002

The World Conservation Union (IUCN) had been the implementing agent for this initiative, and the projects that were initiated, as part of the initiative was to demonstrate to the people the kinds of issues that would be addressed by their leaders at the summit. Two of the most prominent projects initiated as part of this initiative included (Greening the WSSD, 2002):

• The Johannesburg Climate Legacy Project

This project offered delegates the opportunity to offset the carbon emissions produced at the WSSD. The delegates were told that most of the Carbon dioxide that was expected to be produced during the WSSD would be as a result of their flights to South Africa. The climate legacy website could have been used to calculate how much carbon a specific delegate would generate and each delegate could then buy a "Climate legacy certificate" where R100 or US$10 was worth a ton of carbon. The funds raised trough this project are going to be used to support South African projects to permanently reduce carbon emissions.

• The Consumption Barometer

With this project an attempt had been made to monitor and reduce the environmental impact of a major UN gathering for the first time (Greening the WSSD, 2002). According to the Consumption Barometer, the WSSD produced 331 tons of solid waste and 290 000 tons of carbon dioxide, the recycling of waste and the carbon offset programmes reduced the potentially harmful environmental impacts.

• The Imvelo (Zulu for "nature") Awards

This ceremony formed a central part of the Hospitality Industry Campaign for Responsible Tourism launched by FEDHASA in association with the Greening the WSSD initiative (Greening the WSSD, 2002). The aim of the campaign is to encourage local hospitality members to accept voluntary guidelines that promote responsible tourism in all areas of operation. These guidelines are in line with:

• The National Guidelines for responsible Tourism
• The World Trade Organization's Code of Ethics
• Broad ISO 14001 best practice, and
• The International Hoteliers' Environmental Initiative.

Funds to the amount of approximately R300 000,00 had been raised in order to hold this event, and it had been raised mainly from the private sector.

The Greening the WSSD initiative aimed at leaving a permanent legacy for the Gauteng province such as waste management systems, water management in the hotel industry, corporate procurements policies and practices and the carbon-offset programme. The Johannesburg Climate Legacy Project had raised approximately $320 000,00,² and this will in turn be directed towards other carbon reduction projects in South Africa.

2.2.2 Education Sector Campaign

This had been a joint strategy by DEAT and BHP Billiton Development aimed at creating awareness about WSSD 2002 and to get students, teachers, lecturers, parents, education organisations and youth organisations to participate (Manale, 2002).

The key strategic objectives of the campaign were:

• Raising public awareness of links between Sustainable Development (SD) and everyday life of children and youth.
• To provide glorious visual material to be used in the marketing of WSSD.
• Development of dialogue on SD guided by the Year of Sustainable Development, impacting on educational issues.
• To incorporate SD as a subject matter in educational curricula.
• To leave a legacy for the 2002 generation.

The campaign had been divided into two main areas, namely:

• National Children's Art Challenge ("The world through my eyes")

This campaign entailed the participation of 2002 ten-year-olds producing their understanding and interpretation of sustainable development in art form.

• National Schools Essay Challenge ("How does my career contribute to sustainable development?")

This essay intended to bring to the fore the Fact that SD is a concept that impacts all people in every aspect of life. It asked secondary school pupils going into matric and who are thinking of their careers to consider the issue of sustainable development and how their chosen career involves itself with it.

According to DEAT as well as BHP Billition, these projects had a very specific economic impact, and it can be set out as:

• Three students received the prizes in total of R185 000,00 and will feel the legacy of the WSSD and the challenge has improved their lives for good.
• Computers worth R40 000,00 will change the situation at the schools where the children study.
• A student intern who had been appointed at DEAT for the challenge has received an amount of R8 000,00 for the 4 months of her internship, and the skills that she has acquired makes her more employable.
• The company that did printing and distributing is a youth empowerment company.
• The adjudication fees to the tune of R28 000,00 were paid out to young journalists having an obvious impact on their economic situations.
• There had been a mass participation with an excess of 1 000 entries, keeping in mind that the entries had been limited to 10 year olds and Grade 11 pupils.

It is thus clear that this project had reached its objective of making people more aware of the WSSD and the concept of sustainable development. The grant of R500,000 that DEAT received form BHP Billiton Development had been put to good use in educating the children about sustainable development, a concept that would be with them for the rest of their lives.

2.2.3 Craft sales

The Department of Arts, Culture, Science and Technology decided to use the platform created by the WSSD to organise its second annual Craft Imbizo. The Imbizo was held at the Ubuntu Village in what was regarded as a summary of small-scale South African craft production at a very large scale. Crafts from all nine provinces had been placed on display, and the main objectives of the Imbizo had been the following:

• The showcasing of the very best authentic South African crafts from all nine provinces
• To broaden the market opportunities for South African crafts
• To create general awareness of the craft sector and its achievements
• To provide an avenue for direct sales to the public and WSSD delegates

The crafts selected for participation, had been accredited by Proudly South African and DACST had also been involved in the final selection process. The initiative was possible due to the combined efforts of the Department of Arts, Culture, Science and Technology, the Department of Trade and Industry, the Tourism Enterprise Programme and Proudly South African. The outcome of these craft sales can be set out as follow:

Table 6: Craft sales per province

Source: DACST

2.3 Flow of funds

With regard to the various initiatives that had been described in this document, along with other WSSD related expenditure, the specific flow of funds with regard to WSSD can be established, and set out in Diagram 1. Various Government Departments made funding available for the WSSD, a certain percentage of the funds made available was transferred to JOWSCO, which in turn was responsible for raising its own funding through private donors to invest in the Summit. The diagram clearly indicates the main sectors in which the funds had been invested as well as the percentage of the share of the investment.

Diagram 1: The flow of funds

Diagram 1 set out the flow of investments that were made to the South African economy due to the hosting of the WSSD. Government Departments were responsible for investing R552 million into the economy (i.e. R312 million to JOWSCO and R240 million directly towards Summit activities), whilst JOWSCO's expenditure amounted to R613 million. The main sectors of the economy that benefited from this investment are set out in the diagram and these are:

• Government and personal services
• Financial and business services
• Transport and communication
• Wholesale and retail trade

Apart from the funding received from Government, JOWSCO raised additional funds for the summit, and Table 4 sets out the sources of these funds.

The funds as set out in Diagram 1, Table 2 and Table 3 were injected into specific sectors of the economy. These sectors, as well as specific aspects dealt with in each sector, are:

• Government and personal services
  • Public administration and security
  • Human health activities
  • Recreational, cultural and sporting activities
• Financial and business services
  • Real estate activities
  • IT and related activities
  • Advertising
• Transport
  • Transport infrastructure
  • Telecommunications
• Wholesale and retail trade
  • Hotels and restaurants
  • Hotels, camping sites and other provision of short-stay accommodation
  • Restaurants, bars and canteens

These economic sectors are also regarded as the sectors in which tourism spending traditionally takes place.

In addition to the investment made by Government and JOWSCO, it had been determined through surveys that there had been additional private sector expenditure directed into the various events that ran parallel to the summit. This expenditure can be set out as follow:

• The total amount invested in the NASREC event amounted to R178 million.
• With regard to the Ubuntu Village the expenditure amounted to R22 980 000,00.
• Expenditure into the Waterdome events had been to the tune of R49 000 000,00.
• Expenditure into the Business Week events had been to the tune of R2 900 000,00.
• The Greening the WSSD initiative's expenditure amounted to R29 000 000,00.
• A total amount of investment for the parallel events had been calculated at R261 697 152,00.³

2.4 Economic injections

Diagram 2: Economic injections

From an economic perspective the WSSD can be interpreted in terms of the activities set out in the first row of Diagram 2, which led to a certain impact on the economy. These impacts can be described as follow:

• Government made various expenditures in order to ensure that the Summit could take place, including infrastructure development and security. These are regarded as supply side economic impacts.
• The investments made by JOWSCO as well as other private investors were also made in areas such as infrastructure, transport and marketing, which are also regarded as a supply side economic impact.
• Activities related to accreditation for people attending the summit main event at Sandton as well as the parallel events are considered to be consumer expenditure therefore is regarded as consumption expenditure.
• Money that is invested by exhibitors taking part in WSSD are regarded as both private current as well as fixed, creating a consumption expenditure and supply side economic impact.
• Investments that had been made with regard to the parallel events are to have consumption expenditure as well as supply side economic impacts.

SECTION THREE: INPUT DATA

The analysis of the economic impact of the Summit evaluates both the supply and consumption expenditure side of the event. The supply side (i.e., expenditure by government and business) measures the impacts of hosting the event and impacts associated with tourism business and capital expenditures. The demand side (i.e. delegate - accredited and non-accredited – expenditure) analysis, measures the impact of visitors' expenditure (i.e. accommodation, food, beverages, transport, etc) on all the other sectors of the economy.

The modelling of the economic impact distinguishes between varieties of impact measures, direct, indirect and induced effects. However, for the purpose of the report, distinction will be made between direct and indirect impacts. The direct impact is the initial delegate expenditures as well as the goods and services purchased by government and business sectors, whilst the indirect effects refer to subsequent purchases made by the suppliers to sustain the direct expenditures. The direct and indirect impacts refer to the total impact of the Summit.

3.1 Number of Delegates

The number of delegates for international government and media included in Table 7 were provided by the United Nations.

Table 7: Accredited and non-accredited delegates according to category

In addition to the above, it is estimated that 25 000 delegates visited the WaterDome and 12 000 visited the Business Week events.

According to information gathered, approximately 307 570 people visited the Ubuntu Village between 17 August and 7 September 2002. This can be broken down into approximately an average of 13 089 people per day. It has also been established that an additional 20 000 people can be added to the total as they represent people not counted by the normal counting process. Of the total people, 3 000 were workers that represent 66 000 persons walking through the gates over the Summit period.

3.2 Expenditure Profile

Based on the face-to-face interviews that had been conducted during the Summit, an average expenditure profile had been established for the main categories of delegates as set out in Table 7.

The average budget of foreign delegates varies from R17 071,44 for support staff to R39 224,66 for government delegates.

Table 8: Budget per delegate

The ideal method to calculate total expenditure would have been to inflate the average budget separately for delegates falling in each of the above-mentioned categories and also to inflate it separately for delegates from foreign countries and those from South Africa. However, no such breakdown is available.

The estimated expenditure of registered foreigners to the WSSD is set out in the following Table. It should be noted that these budgets include airfares. These budgets include airfares. However, not all income from airfares paid will flow to South Africa. Based on preliminary information from SAA (revenue passengers 17 to 31 August 2001 and projected figures for August 2002) it is estimated that 23% of all air fares paid by foreigners went to airlines other than SAA and its partner airlines with 77% going to SAA and its partner airlines. The average cost of air tickets as reported by 129 foreign delegates was R4 847,39. Therefore, an amount of R1 114,90 (23%) of the budgets of foreign delegates won't flow to South Africa. The average budget of the South African delegates is R6 129,26 including airfares for travelling in South Africa.

Table 9: Delegate expenditure

The amounts as set out in Table 9 do not include any expenditure details by persons attending the parallel events, such as Nasrec.

The expenditure by the delegates at the Waterdome was reflected by research to have been R40,00 per head, for the Business Week events it was R85,00 per head, and for the purposes of the amount of expenditure for the Ubuntu Village, R10,00 per head has been accepted. If these assumptions area accepted, the income generated at the events can be set out as follow:

• At the Waterdome, 25 000 delegates @ R40,00 per head = R1 000 000,00
• For the Business events, 12 000 delegates @ R85 per head = R1 020 000,00
• Ubuntu, 261 570 people @ R10,00 per head = R2 615 700,00
• The income generated at NASREC has been taken into account in the section dealing with South African delegates expenditure.

Delegates were requested to give a breakdown of their expenditure in South Africa according to the following categories: accommodation, food and drink, transport in South Africa, entertainment and leisure as well as shopping. Most of the delegates were not able to give these details. However, the information supplied by the 244 delegates who were able to give it is used to calculate the following breakdown:

Table 10: Breakdown of delegate expenditure

3.3 Sectoral Expenditure / Investment

The total amount of R854 million was injected into the South African economy due to the Summit by Government Departments and JOWSCO (own funds and private donors) as set out in Diagram 1.

The monetary effect of this investment is set out in Table 11.

Table 11: Investment per sector

3.4 Supply Side Impacts

The supply side impacts refer to the effect of government and private sector expenditure to host the Summit. In order to identify the real (net) economic impact, distinction is made between new expenditure (i.e. private sector and donors) and government expenditure. New expenditure is injections into the economy as a direct result of the Summit and would not have taken place if the Summit would not be hosted. The government expenditure can be regarded as fast track injections into the economy driven by hosting the Summit.

Table 12: Economic impact of government and private sector expenditure

Note 1: Economic impact from organisational and management expenditure point of view

According to Table 12, the total supply side impact of the Summit can be summarised as follows:

• The total expenditure of R1 397,0 million generated new business sales (i.e. gross additional economic output) worth R4 237,8 million. This implies that for each Rand of expenditure in hosting the Summit, R3,03 is generated throughout the South African economy.
• The total number of employment opportunities supported by the supply side expenditure is 9 840.
• The contribution to the GDP is estimated to be about R861,4 million.

The real supply side impact is based on new expenditure as a result of the Summit and are the following:

• The new expenditure of R1 157 million generated gross additional economic output of R3 509,8 million and supported about 8 150 employment opportunities.
• The contribution to the GNP is in the order of R713,4 million.

3.5 Consumption Expenditure Impacts

The consumption expenditure side impacts represent the expenditure by delegates attending the Summit and are outlined in Table 13.

Table 13: Economic impact of delegate (tourism) expenditure

Note 1: Economic impact from the delegate expenditure point of view

According to Table 13 the total consumption expenditure side impact of the Summit can be summarised as follows:

• The total expenditure of R1 552,0 million generated new business sales (i.e. gross additional economic output) worth R4 913,4 million. This implies that for each Rand of expenditure in hosting the Summit, R3,17 is generated throughout the South African economy.
• The total number of employment opportunities supported by the supply side expenditure is 10 150.
• The contribution to the GDP is estimated to be about R919,5 million.

3.6 Total Impact

The total impact of the Summit is the combination of the supply side and consumption expenditure impacts as outlined in Table 14.

Table 14: Total economic impact

Table 12 shows that the Summit injected a total amount of R2 949,0 million into the economy of South Africa. This injection generated new business sales via the government and private sector spending, donor funding and expenditure by the delegates of R9 151,2 million. This injection stimulated 19 990 employment opportunities and contributed R1 780,9 to the GDP. The latter represents less than 1% of the total GDP of South Africa.

3.7 Net Benefit

In order to determine the real economic impact of the Summit, it is realistic to assume that only the new expenditure should be accounted for in the analysis. This implies that expenditure from government should be excluded from the impact analysis because these funds would have been spent on non-Summit activities. Based on the above, Table 15 outlines the real impact of the Summit on the South African economy.

Table 15: Real economic impact

The real economic impact should be interpreted as the net economic benefit of hosting the Summit. Based on this, the Summit has lead to the following impacts in the economy:

• The Summit generated R2 709,0 million of direct expenditure in various sectors of the economy.
• This injection led to an increase in the demand for goods and services, implying that new business sales in all sectors of the economy increased by R8 423,2 million.
• It is estimated that the number of employment opportunities supported by this direct expenditure is in the order of 18 300. The contribution to the GDP is R1 632,9 million, which is less than 1% of the national aggregate.

3.8 Non-Quantifiable Issues

The approach followed in this study concentrates on quantifiable effects and not the long-term benefits. Some of these benefits have been identified during the surveys, and is related more to the perceptions that the delegates have after participating in the Summit. Table 16 sets out these perceptions in greater detail.

Table 16: Rating by respondents

The positive ratings ("good" and "excellent" combined) range from a low of 30,4% ("pre and during Summit leisure activities") to a high of 84,6% ("hospitality and friendliness"). The low rating for "pre and during Summit leisure activities" may be attributed to the high percentage of respondents (46,0%) who had not had the opportunity to experience these activities. Aspects with a combined positive rating of just less than 50% include "organisation of the WSSD" (44,3%), "information on the WSSD" (41,5%) and "transport in South Africa" (43,4%).

The negative ratings ("very poor" and "poor" combined) range from a mere 1,7% ("hospitality and friendliness") to a relatively low 26,1% ("information on the WSSD"), with "transport in South Africa" (23,9%) and "organisation of the WSSD" (15,4%) also perceived as "very poor" or "poor" by a relative number of respondents.

Overall, it would seem that respondents were generally satisfied with the organisation, infrastructure and public relations at the Summit.

It is also important to mention the positive spin-offs that had been created for the people of South Africa due to their country's hosting of the WSSD. These non-quantifiable aspects include i.e.:

• Many people had become more employable due to their involvement.
• Taxi associations realised the benefit of working together.
• Children were granted the opportunity to express their own ideas about the concept of Sustainable Development.

Related to the non-quantifiable aspects of the WSSD, the tourism potential can be taken into consideration. During the surveys, the delegates were asked whether they would return to South Africa on holiday and whether they would advise their friends, relatives and colleagues at home to visit the country.

3.9 Return visits

Most respondents (73,5%) would like to come back to South Africa on holiday while almost a quarter (24,2%) either did not respond or were uncertain whether they would return to South Africa. Only 2,4% indicated that they would not return.

3.10 Recommendations to friends, relatives and colleagues at home

The majority of respondents (75,4%) would advise their friends, relatives and colleagues at home to visit South Africa. A low 1,9% responded in the negative and would advise them not to visit the country. The remainder (22,7%) were either undecided or did not respond.

It is thus clear that although it is difficult to accurately determine the impact of the WSSD on the South African tourism market, it can be stated that there had indeed been an impact, which could lead to various potential future visits.

2 Saliem Fakir, 2002.

3 Working on the premise of 489 events (this had been established through the surveys that were done on the parallel events), the investment per parallel event was calculated at R535 168,00.

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