The Government will await the completion of a cost-benefit analysis possibly next week before approving any funding that would enable Ireland to host the 37th America's Cup in Cork Harbour in 2024, Minister for Public Expenditure Michael McGrath has said.
Mr McGrath said that the analysis by Ernst & Young would not be completed this week. But he did expect it to be finalised "very shortly" and it would then be brought before Cabinet which would then make a decision on whether or not funding would be approved to support an Irish bid.
“The position at the moment is that an extensive process of due diligence is under way . . . a significant amount of public money is involved so it is critically important that we have our due diligence completed,” he said.
According to afloat.ie, an Irish bid could involve a State investment of up to €150 million with the EY report suggesting that hosting the 2024 America's Cup could be worth up to €500 million to the Cork economy. But Mr McGrath was reluctant to discuss any figures when asked about the bid on Monday
“I’m not getting into the figures . . . we need to make sure from an expenditure point of view we have a proper appraisal of what the outlays of public monies are.”
According to afloat.ie, the €150 million cost to Ireland is broken down as €100 million capital investment in legacy/infrastructure such as the refurbishment of docks for berthing the high-speed hydrofoil sailboats, with the remaining €50 million earmarked as a "current" spend.
Mr McGrath confirmed that the organisers of the 37th America’s Cup have requested “an upfront payment to advance the process” and that would be considered along with other factors such as the benefits when it comes before Cabinet. But he stressed the importance of waiting due diligence.
“We know from previous experience that putting in the effort at the time up front and getting the analysis done properly always has a good return. And it’s important to do that so that we don’t have any surprises later on in the process if we are going down that road,” he said.
Cork's bid to host the event has been championed by Mr McGrath's Cork South-Central constituency colleague, Minister for Foreign Affairs Simon Coveney, who met with a team of visiting event specialists in June to assess its suitability as a possible venue.
Global event
Mr Coveney, a keen sailor, accompanied the specialists on a tour of Cork Harbour to assess its suitability in terms of being able to provide a site for a team village, local facilities and attractions, and the essential racing elements like wind speed, tides and the racing circuit.
Mr Coveney has previously stressed the global nature of the America’s Cup, nicknamed the Auld Mug, the competition for which takes place for every four years.
“EY are in the middle of finalising a cost-benefit analysis at the moment in terms of the financial value to the country of a global sporting event of this scale which many would say is third only to the Olympics and the football World Cup in terms of a hosting a global sporting event,” he said.
The 36th America's Cup was hosted by Auckland in New Zealand in 2020 and while Mr McGrath said that he had not seen the audit report on the success of that event, the EY analysis would examine the experience of New Zealand and Spain which previously hosted the event.
According to sail-world.com, one of Cork's main rivals to host the 2024 competition, Valencia in Spain has withdrawn from the competition to be replaced by an all-Spain bid which has Spanish government backing while Jeddah in Saudi Arabia is also bidding to host the event.
Last month, The Irish Times reported that the evaluation of bids will be carried out by Origin Sports, a London-based sports consultancy, whose chief executive Stewart Hosford is originally from Cork. A decision and an announcement is expected by September 17th.
Mr Hosford, who knows Mr Coveney on a personal basis, said that “if Ireland is successful, they’ll be successful on their own merit.” And while he would not comment on potential costs involved in hosting the race, he did say the event would provide “exceptional value for money”.
‘Open for business’
Meanwhile Cork Chamber of Commerce president Paula Cogan said that the America’s Cup offered Cork an opportunity to gain worldwide attention and send out a clear signal to 900 million viewers of the competition that “Ireland has successfully navigated the pandemic and is open for business”.
Ms Cogan emphasised the economic value derived from hosting the America’s Cup.
“For example, looking to Valencia in 2007, €615 million was spent directly by agents directly involved in the sport, visitors spent €76 million, there were 2.5 million spectator visits and €28 million in advertising equivalent value,” she said.
“The EY analysis adds some further precision to what these figures could mean for hosting the event in Cork. There is an estimated €500 million economic return and benefit to Ireland with €50 million in investment required to run the event and €100 million investment in long-term legacy infrastructure.
“We have a positive cost-benefit analysis . . . the timing is perfect to show the world a welcoming region of outstanding natural beauty and economic potential.”
