With the Fédération Internationale de Football Association (FIFA) announcing Dec. 2 the locations of the World Cup in 2018 and 2022, investors who have been thinking about putting their money on Russia and Qatar may want to place their bets now.
The newly announced hosts of the world’s largest sporting event—Russia will handle the 2018 soccer match while Qatar is on tap for 2022—will likely see a boost to their national economies as a result of the hordes of fans who visit, according to investment analyst Ed Kuczma for the New York-based Van Eck Emerging Markets Fund.
“FIFA looks almost like a supernational wealth fund like the International Monetary Fund, like a semi-political organization looking to develop these economies,” Kuczma said. “What these games do is make a push for modernization within these economies and development of infrastructure. It really has a long-lasting impact.”
Van Eck sells a Market Vectors family of exchange-traded funds, which includes a Russia ETF (RSX, AUM: $2.3 billion) and a Gulf States Index ETF (MES, AUM: $14 million). As a firm, Van Eck Global manages $29 billion in assets.
What Your Peers Are Reading
“We look at the emerging markets as a growing and important part of the global economy in the last decade,” said Ed Lopez, marketing director and product manager for Van Eck’s ETFs. “A lot of them have taken steps to improve their economies with better policies and better balance sheets.”
Russia beat out bids by England, Spain-Portugal and Belgium-Netherlands, and Qatar topped a U.S. bid. Kuczma pointed out, however, that South Africa this year proved that emerging nations are just as able to host the World Cup. And, he added, soccer-mad Brazil has been tapped to host the event in 2014.