After two sun-filled days of play, our IRP group finally got down to some business. We awoke and met in the lobby bright and early (well, 9am, which is “bright and early” in Brazilian time) and hopped on a bus to Barra, where our first meeting was to be held.
On our way to Barra, one of the richest areas in Brazil, we passed by one of the largest favelas in South America. Being from the US, where most prime real estate is located in the hills, we find it ironic that the favelas are built far up into the hills, while the most expensive housing is on the flattest land, but we learned that it is because the land in the hills is very unstable, so no people can legally build houses there. In fact, last year extreme mudslides killed many, many people in Brazil, most being from the favela neighborhoods. We also learned that, with a minimum wage of 540R per month (about 340 USD, and a cost of living comparable to DC) most people who live in the favelas make far below a living wage, with virtually no hope of even coming close to affording real housing.
Our first meeting was with Francisco Havas of Havas Tours (also a GW alum), a destination management company that handles logistics for large-scale events such as the Olympics and World Cup. He opened the meeting by showing us a video of some of the most attractive tourist attractions in Rio, then dove straight into a detailed discussion of the macroeconomic factors affecting tourism development in Brazil and, consequently, Rio2016. To sum up his presentation, over the past 10 or so years, Brazil has experienced steady growth in international tourism revenue (close to about $6 billion in annual revenue today), but over the past few years the actual number of people visiting Brazil has stabilized around 5 million, mostly due to recent hyper-inflation and the rapidly appreciating Brazilian currency (in 2003, American travelers could get about 4R per 1USD, but today it is about 1.6R to 1USD). So, tourism has developed, but not enough, but that is expected to change due to increased promotion for the country surrounding the World Cup and Olympic events. However, the tourist capacity in Rio is currently only 28,000, so that gives you an idea of the massive amount of infrastructure that is needed to fill the increased demand for beds during and even after the upcoming events. It is evident that Brazil has a lot of work to do leading up to the two megaevents it is hosting, but both events are expected to greatly boost the economy, including expected job creation of 32,000 (permanent) and 381,000 (temporary).
Following our meeting with Mr. Havas, we hopped back on our tour bus and headed to Pontifícia Universidade Católica do Rio de Janeiro (PUC), a Catholic University in Gavea, where our next few meetings were set to be held. The University, set right in the middle of a Brazilian rain forest, was beautiful, and they have one of the top MBA programs in Brazil. While at PUC, our group was welcomed by the Dean of the Business School and a Professor of Marketing, then Paul Whealan, a FIFA Hospitality Planner from a company called Match, came to speak. Mr. Whealan has lived in Rio for the past 5 years and his company manages accommodation, ticketing services, and computer solutions for the FIFA World Cup. It was interesting to learn about the different types of logistical challenges that planners face when planning for a mega, multi-city event like the World Cup, versus a single-city event like the Olympics. So much planning is required in advance of the World Cup because, whereas Olympic games and schedules are set years in advance, it is completely random with the World Cup, based on a draw that takes place only 6 months in advance, and then in between matches on who wins/loses/etc. Sometimes they may only have 3 days to plan the logistics for teams and their hundreds of thousands of spectating fans.
Last, we had Maureen Flores, the Director of Sustainability for Rio2016, visit our group. She spent her time educating us on Rio2016’s sustainability initiatives, as well as the learnings she took away from the recent Sport and Environment Conference. With a background in environmental policy, she was only hired to her current position about 6 months ago, so much of her work to date has been laying out plans for how Rio can meet both its environmental and social sustainability goals, as well as revising the goals that stakeholders have promised in efforts to ensure all objectives are realistic. I was actually very surprised to learn how sustainable a country Rio is – for example, 70% of the country is hydropowered, and most cars are fueled by ethanol – so Maureen’s goal for Rio2016 is to raise the bar and have sustainability be one of the aspects of the Games that Rio leaves behind.
All in all, a great first day of work. We had a free day today to work on our projects (out by the pool, of course) and we are just getting ready to head to a GW alumni reception.
Side note: I was recently informed by tourism an branding group that if you Google “visit Brazil,” a blog post of mine is one of the first things that pops up 🙂