The history of the World Expo dates all the way back to 1851. Backed by a legacy of 170 years, this grand event has come a long way ever since its inception.
Also known as the World Fair or the World’s Greatest Show, the World Expo happens to be one of the few events that command global attention. It all started in London where the first fair called ‘Great Exhibition of the Works of Industry of All Nations’ had 34 countries participating and was all about showcasing the industrial prowess of these nations.
Arguably one of the biggest global events besides the likes of the FIFA World Cup and the Olympic Games — the World Expo has traditionally been an international platform for countries to parade their innovations in the field of science, art and technology.
We’re unpacking the finer details about the economics of the World Expo. Let’s backtrack a bit and start with the very essence of this historic global exhibition.
Home to the greatest inventions of all time
The World Expo has been home to the debut of some of the most outstanding discoveries of our time. From ice cream cones, popcorn and Coca-Cola to broadcast televisions, the first mechanical computer and touch screens — countries have exhibited their greatest inventions at these events.Fun fact: Back in 1876, it was at the World Fair in Philadelphia that Alexander Graham Bell showcased the first telephone.
Fast forward to today, the World Expo 2020 which was delayed due to the pandemic — kicked off in Dubai on October 1st last year, in a grand fashion with a record 192 countries participating in this extravaganza.
A historic moment for World Expo
The World Expo has another historic moment added to its kitty with Dubai being the first city from the Middle East to host the event. Hoping to recover from the economic downturn brought on by the pandemic, Dubai World Expo 2020 is hosted on a desert site that is the size of six football fields. 25 million visitors are expected at the event over the span of 6 months till March 31st, 2022.
Along with some unmissable sights such as the original coffin of the Pharaoh and a grand pavilion shaped like falcons, another noteworthy mention is that India has the largest pavilion at the World Expo this year — a magnificent four-storeyed pavilion that’s designed to display the 75 years of the nation’s independence.
Let’s talk money: How much did the Dubai World Expo cost?
With an overarching theme of ‘Connecting Minds, Creating the Future’, the Dubai World Expo was built from the ground up on a 4.3 sq km (1.7 sq miles) of desert and ended up costing close to $7 billion.
Almost a decade went into the making of this mega event that employed over 230,000 workers.
The World’s Greatest Show is crucial to Dubai’s recovery from the paralyzing effects of the pandemic. Being among the first of such experiences for the UAE, it’s safe to say that the World Expo holds the fate of the country. With an aim to showcase emerging technologies and innovations to the global community, the World Expo is undoubtedly a phenomenal event for businesses to promote their brand and reach out to a wider audience base.
The financial opportunity
With the sheer scale of World Expo 2020, the benefits of this major project will be felt even after the event comes to a closure.
Dubai is betting big on the Expo and is looking to boost its economy, especially its tourism, trade and business hubs. According to Ernst and Young’s pre-pandemic estimates, Dubai World Expo is expected to contribute AED122.6 billion ($33 billion) to the UAE economy from 2013–2031. From the figure of AED122.6 billion, close to AED53.5 billion is expected to come directly by spending on the event — the remaining share will come from distant economic activities further up the supply chain. Going by this report, the Expo is also expected to support over 905,200 jobs until 2031
The good news is that within just a month of starting the Expo, business activities in the UAE touched an all-time high in comparison to the previous two years. Dubai’s economy is looking to bounce back with the purchasing power and employment opportunities rising at a rapid pace.
Will there be a near-term boost for the SMEs?
Absolutely! Dubai World Expo 2020 provides an unprecedented platform for SMEs in the UAE and the world over.
The World Expo creates a favourable environment for entrepreneurs to seek investment, move into different product lines and tap into new markets. The Expo is expected to bring about a greater boost to the region’s economy and business ecosystem, which in turn will prove to be beneficial to SMEs in the UAE and globally.
A rise in economic activity will attract more talent and create viable business opportunities for SME business owners. From the 4,500 contracts awarded by the World Expo, SMEs have won more than half the share — which means the SME sector is likely to get an investment of nearly AED 5 billion.
Close to 80% of the Expo’s site will be converted into District 2020 — a global business community. District 2020 will eventually be home to SMEs and favour their plans of expansion.
With an expected footfall of 25 million visitors, the Expo provides a much-needed platform for networking; and SMEs will enjoy greater exposure to potential investors and partners.
The pandemic had staggering effects in the highly indebted nation of UAE. That said, the Expo might result in high rates of over-capacity in the hospitality and real estate sector.
While debt risks threaten to linger for long, Dubai’s skyscraper-filled skyline is headed for an immediate economical boost. The Expo will be a powerful tool to leverage the working capital needs of the region — which means Dubai’s GDP and economy are set to blossom in the coming years.
Think Working Capital…