The deal
Earlier this month (March), the Olympic Council of Malaysia (OCM), the country’s Olympic organizing body, claimed that the Commonwealth Games Federation (CGF) had offered it the chance to host the 2026 edition of its quadrennial Commonwealth Games international multi-sport competition.
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Alongside the chance to host the games, the OCM stated, was an accompanying offer from the CGF of £100 million ($128 million) to support the event’s hosting.
With the offer, Malaysia has the chance to stage the Commonwealth Games for the first time since 1998, when its capital of Kuala Lumpur hosted the event.
Why it matters
The Commonwealth Games Federation has struggled to find willing hosts for its 2026 edition, despite now being just over two years away.
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By GlobalDataVictoria, Australia, had been selected as the host in 2022 following talks with the CGF and had been set to be the first-ever regional host for the event, as opposed to having it focused around a singular city.
In July 2023, however, the state withdrew as host due to a massive increase in the projected costs of hosting the event.
Victoria Premier Daniel Andrews said initial estimates last year had put the cost of the games at AU$2.6 billion ($1.77 billion), but new estimates suggested it would be closer to AU$7 billion.
Andrews stated at the time: “Frankly, six to seven billion for a 12-day sporting event… we are not doing that. That does not represent value for money. That is all cost and no benefit.”
Another Australian region, Gold Coast, put itself forward as a host following Victoria’s withdrawal, having already staged the 2018 edition around the city of Brisbane, however by the end of 2023 it too had withdrawn after failing to garner state or federal government support for its bid.
Victoria had to pay the CGF AU$380 million for its withdrawal, but the 2026 games were still without a host.
With Alberta, Canada, also ending its bid to host the 2030 edition of the games, the continued lack of a host for the 2026 edition has cast the entire future of the Commonwealth Games itself into doubt.
The details
The OCM stated that the supposed £100 million offer was earmarked for the “local delivery and legacy planning” of the tournament. Although Kuala Lumpur may have much remaining infrastructure from the 1998 games, spending so much on an event of declining reputational value would be a tough decision for most countries to make.
It is estimated that the 2022 Commonwealth Games, held in Birmingham, England, cost around £778 million to host, while the aforementioned Victoria 2026 proposal would have cost many times more.
The scale of such a financial commitment has dissuaded many countries in the Commonwealth, an association of nations that were formerly territories of the British Empire, from hosting.
Despite record domestic streaming viewership in the UK for the 2022 games and a record turnout for a UK edition of the games of 1.51 million fans, the opportunity cost is just too high for smaller, less wealthy nations or regions to make hosting viable.
The reticence of many eligible countries to spend such an amount is evident in the narrowing number of different countries that have hosted the event in recent years.
GlobalData Sport analyst Conrad Wiacek stated: “The CGF offering funding to nations to host the Commonwealth Games not only highlights the challenges that major event organizers have in securing willing hosts, speaking to how prohibitive the costs of hosting a major sporting event is for most countries.”
In the 21st century, six editions of the Commonwealth Games have taken place, two of which were hosted in England (with one in Scotland), two in Australia, and Delhi in 2010. Compare this to the prior five editions, which took place in five different countries and only once in the UK and Australia,
Wiacek continued: “While some nations are willing to do so as a means of highlighting global or regional power and superiority or to help drive the development of a sport in a particular market, events such as the Commonwealth Games simply do not drive enough interest or eyeballs to be commercially viable given the cost of hosting the event.
“Some could make the argument that hosting an event such as the Commonwealth Games will help drive regeneration in an area, as was the case with the latest edition in Birmingham. However, with the Birmingham City Council now bankrupt, that short-term benefit is likely to lead to long-term pain.
“With the CFG competing with the likes of the Olympics in terms of eyeballs, there simply may not be room for two large scale multi-sport events on the calendar"
