Sunday 14 March 2010
Revealed at last: the true purpose of the World Expo
Suddenly, the true purpose of expos becomes a lot clearer. Judging from their track record, they are nothing more than a device used by corrupt but self-aggrandising officials to siphon vast amounts of money out of the public purse and into their own pockets and those of their business cronies.
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Revealed at last: the true purpose of the World Expo
Tom Holland
12 March 2010
This might sound like a dumb question, but what is an expo? I mean, what actually goes on at an expo? What are they for?
I feel I really ought to know, given that the publicity surrounding the Shanghai expo is reaching a near-hysterical pitch.
The expo’s official website isn’t much help. It promises a “world-class event” that “will display urban civilisation to the full extent”. But it’s remarkably short on specifics.
I asked around. Most of the people I know seem equally mystified. “It’s, you know, an expo,” answered one colleague. “There are different pavilions and things.”
The best explanation came from another friend.
“It’s like a trade show,” he answered. “But instead of companies exhibiting, you have countries. And they don’t actually sell anything - no deals get done.”
“So what’s the point of it then?” I asked.
“I guess it’s just self-promotion,” he said, “you know, a national pride thing.”
There was no such fuzziness about the point of the first international expo, the Great Exhibition, held in London back in 1851. It was unashamedly intended to promote British industrial products to a global marketplace.
“Whatever human industry has created you find there,” wrote the novelist Charlotte Bronte, describing “great compartments filled with railway engines and boilers, with mill machinery in full work, with splendid carriages of all kinds”.
At a time when long-distance communication and travel were difficult and time-consuming, such a massive show served an obvious purpose by bringing buyers and sellers together and showcasing manufactured goods.
As a result, the commercially funded Great Exhibition was a resounding success, turning a profit of just under US$1 million in the money of the day.
The logic behind subsequent expos has been less clear, however. These days, expos are typically championed by backers in local government. Generally, they promise a cornucopia of economic benefits, saying the expo will revitalise rundown urban areas, attract millions of visitors, put their city on the international tourist map and generate vast profits.
The reality, alas, turns out to be different. Costs almost always overshoot, and visitor numbers usually disappoint. The expo closes having made a huge financial loss, and as often as not the organising body collapses amid allegations of incompetence and corruption.
The organisers of the 1984 expo in New Orleans, for example, filed for bankruptcy after making a loss of US$121 million. The head of the 1986 Vancouver expo, which made a US$337 million loss, was accused of skimming off funds to buy himself a Mercedes-Benz.
A Spanish court found the organisers of the 1992 Seville expo guilty of fraud, and several officials of the 1998 Lisbon expo were arrested following a land sale scandal. The Hannover expo of 2000 lost €1 billion (HK$10.6 billion), and earlier this week it emerged that the Zaragoza expo of 2008 had lost €502 million.
In fact, as the first chart shows, the only expo in recent years that didn’t make a huge loss was the 2005 Aichi expo in Japan. After a dismal opening drew in just half the forecast visitor numbers, organisers jazzed up the attractions with a frozen mammoth and battling robots and managed to turn an operating profit of US$90 million. That figure is a tad misleading, however, as it doesn’t include the US$7 billion the Japanese government spent on building a vast airport on an artificial island especially for the event.
There is no reason to think the Shanghai expo will break the pattern. The official budget for the event is about US$4.2 billion, but media reports have quoted officials saying the true cost is more than 10 times as much, more even than the Beijing Olympics.
For the expo to break even on gate receipts alone, every single inhabitant of China would have to visit at least once, along with the entire populations of the US, Japan and Russia. As a result, it is a safe bet that the Shanghai expo will record a massive financial loss.
Suddenly, the true purpose of expos becomes a lot clearer. Judging from their track record, they are nothing more than a device used by corrupt but self-aggrandising officials to siphon vast amounts of money out of the public purse and into their own pockets and those of their business cronies.
At last, I understand.
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