What will Serbia gain from hosting EXPO 2027?

As the winner in all four voting rounds at the General Assembly of the International Bureau of Exhibitions, Serbia was chosen to host the Specialized Exhibition EXPO 2027 with the theme “Game(s) for Humanity – Sports and Music for All”.

 This means that from May 15 to August 15, 2027, Belgrade will play host to visitors from all over the world, while the exhibition itself will be held in a facility will be built in Surčin, also the future location of the Belgrade Fair.

What would be the cost of the construction of this facility and accommodation capacities will cost Serbia is currently unknown. What we know is that at least one and a half million euros have been allocated from the state budget to run for the candidacy.

The President of Serbia, Aleksandar Vučić, and the Minister of Finance, Siniša Mali, are optimistic about the financial effects of the EXPO and their estimate says that Serbia stands to earn over one billion euros from hosting the exhibition.

According to the Serbian President, the total estimated financial gain from hosting Expo 2027 will be 1.1 billion euros. He also estimated that the direct economic benefits will amount to 600 million euros, and the indirect ones will be around 500 million euros.

“Hotel industry, catering facilities, Belgrade airport, our national airline… Literally, everything will benefit from this”, said Vučić.

On the other hand, Bojan Stanić from the Serbian Chamber of Commerce claims that at the moment, it is not possible to estimate both the expenses and expected income that the exhibition could generate, because economic analyses still haven’t been done.

“The calculations of income and expenses have not been published, so it is too early to talk about those estimates. However, there are three possible benefits for Serbia. The first is the engagement of our construction industry, which will be involved in building the premises which will house the EXPO. Second, as the exhibition’s host, Serbia will become the centre of the economic exhibition events, which in itself is prestigious. The third benefit will come later, i.e. long-term benefits in terms of the recognition of Serbia as a regional leader and a country that is significantly integrated into international economic flows,” explains Stanić.

He expects the long-term benefits to be incomparably greater than the investments themselves. Stanić also believes that the premises that will be built will be sustainable even after the EXPO.

“They will continue to have an economic purpose and can be used for offices or as exhibition spaces, and even as residential buildings. Also, following the exhibition, this part of Belgrade will profile itself as a business district,” he adds.

Petar Đukić, a professor at TMF, agrees that hosting the EXPO is beneficial for Serbia’s reputation. However, when it comes to economic results, he does not see long-term benefits.

“It is good that Serbia hosts international events, regardless of what government is in power and the current state of our economy. It’s good that we are known for something positive. However, the financial effects are yet to be seen. If the EXPO requires quick and large investments, such as building magnificent facilities to prove to the world that we can do it, then it is a poor idea. Serbia is a small country with a low income, with a population of just over six million, so it cannot expect profit in the long run. Positive effects may be in the short term, in regard to GDP, but definitely not long-term. I am afraid that this will also be an excuse for those politicians who want to use various investments to divert people’s attention from other things in our society that are not that good,” says Professor Đukić.

Although he believes that the cultural and political benefits for Serbia are obvious, he adds that the economic forecasts given by the authorities are not grounded in reality.

“Saying that Serbia stands to earn one billion euros from EXPO is completely unrealistic. It’s not the first time that we hear officials giving us wild guesses that nobody questions later,” Professor Đukić reminds. 

Economist and professor at the FUTURA Faculty of Applied Ecology, Božo Drašković, agrees with Professor Đukić that it is useful for a country to host such an important international gathering as EXPO 2027 because it ensures recognition in the world. But, he also says that in terms of significant economic benefits, there is no room for optimism.

“Financial effects depend on the economic strength of the host country. Given that Serbia has a small economic potential, the exhibition will not generate real benefits in that sense. Tourism is the only branch that stands to benefit from this, but there are no other significant benefits for Serbia hosting the EXPO.  We can see this from other events and trade fairs that we have organized and hosted in the past which were announced as great successes although the verifiable results were absent or were disproportionate to given promises,” Professor Drašković notes.

He goes on to say it is alright to invest in organizing such an event, but not to invest in infrastructure just for the sake of the exhibition, especially in the current circumstances.

“It is unrealistic to move the existing Belgrade Fair premises to the edge of Surčin, not only in the short- but also in the long term. Looking ahead to the next 10 or 15 years, this is an extremely irrational decision. The country’s president has a tendency to talk about big figures without backing them up. I don’t know how he came up with a figure of 1 billion euros. These are baseless claims as no cost-benefit analyses have been conducted as yet,” Professor Drašković adds.

To remind, Serbia was chosen to host a specialized EXPO, which is different from the World EXPO. This means that this exhibition will last three months and will not cover all branches of the economy.

Serbian Finance Minister Siniša Mali claimed earlier that Serbia expected over three million guests to come to Belgrade during the EXPO, while the President of the Serbian Chamber of Commerce Marko Čadež said that the exhibition would create thousands of new jobs.

The last such exhibition was held in Astana, Kazakhstan, in 2017 and had almost four million visitors. The costs of putting together the exhibition cost amounted to around two billion euros.

(Danas, 23.06.2023)

https://www.danas.rs/vesti/ekonomija/prihod-od-milijardu-evra-nerealan-ekonomisti-o-organizaciji-ekspo-2027/

This post is also available in: Italiano

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