BMO Report Projects Modest Economic Lift from 2026 World Cup

BMO Report Projects Modest Economic Lift from 2026 World Cup

The 2026 FIFA World Cup is expected to generate a short-lived increase in Canada's gross domestic product through tourism and hospitality spending, according to a new analysis from BMO Economics. BMO chief economist Doug Porter noted that large sporting events produce real economic effects but cautioned against expecting more than a temporary bump from added spending.

Estimated Gains from Tourism and Local Spending

The report places tourism-related gains for the Canadian economy between $1 billion and $5 billion. Increased spending by residents is projected between $500 million and $1.5 billion. These figures could add roughly 0.1 percentage points to Canada's quarterly GDP on an annualized basis, with the impact split between the second and third quarters.

Impact Focused on Ontario and British Columbia

The economic effects will be strongest in Ontario and British Columbia, the provinces hosting the matches. Porter stated that any positive growth would be welcome given the Canadian economy's limited expansion over the past year, adding that even modest increases should be seen as a positive outcome.

Recent Economic Performance Provides Context

Statistics Canada reported last week that economic growth stalled in the first quarter, marking a second consecutive decline in real GDP and meeting some definitions of a technical recession. The World Cup spending is viewed against this backdrop of subdued national performance.

Net Benefits Limited to International Visitors

Spending at bars and restaurants is anticipated to rise during the tournament. The report emphasizes that only spending by international travellers counts as a net benefit, since resident outlays largely shift from other activities or periods. Data from Moneris released in 2023 showed bar and restaurant spending in Canada rose more than 10 per cent during the 2022 World Cup.

Short-Term Demand Versus Longer-Term Growth

The BMO analysis concludes that the strongest case for hosting rests on a brief demand increase rather than serving as a base for sustained economic expansion. Earlier projections from World Cup organizers included FIFA's estimate of up to $940 million in economic output for the Greater Toronto Area and the B.C. government's forecast of more than a billion dollars in tourism revenue over the five years following the event.

Government Hosting Costs Total $1.07 Billion

Last month the federal budget watchdog indicated that all levels of government will spend just over $1 billion to host the tournament this summer. The federal contribution is expected to reach $473 million. The $1.07-billion total averages $82 million per game across the 13 matches scheduled for Toronto and Vancouver.

By Alex Thompson, Staff Writer