You are using an older browser version. Please use a supported version for the best MSN experience.

Qatar losing World Cup a good bet as scandal hurts markets

LiveMint logoLiveMint 04-06-2014 Alex Duff

Betting on Qatar losing the right to host the 2022 soccer World Cup was suspended by a UK bookmaker because of new allegations about the bidding process.

Quotes in the article

Gala Coral Group Ltd stopped accepting wagers because its oddsmakers believe there’s a good chance the tournament will be taken away from the desert emirate, spokesman John Hill said. The uncertainty caused stocks and bonds to tumble on Qatari markets this week.

Mohammed bin Hammam, a former soccer executive from Qatar, paid more than $5 million to influence officials before tournament voting in 2010, the UK’s Sunday Times newspaper reported 1 June. Bin Hammam declined to comment on the story, while Qatari organizers said he played no role in their bid and that they had the highest standard of ethics.

UK bettors had staked a “five-figure sum” on Qatar losing the tournament at odds as high as 5-1, Hill said by phone on Tuesday. A successful $1 bet would yield a $5 profit, plus the stake.

Former US federal prosecutor Michael Garcia is leading a probe for soccer ruling body Fédération Internationale de Football Association (Fifa) into the 2018 and 2022 World Cup bidding process and is scheduled to submit his team’s findings next month.

The Sunday Times allegations, based on what it called millions of leaked e-mails, put Fifa “into a very difficult situation”, according to Mark Pieth, a Swiss anti-corruption expert who led a panel of governance advisers set up by Fifa in 2011. The ruling body could face “the most formidable lawsuits” from Qatar if it strips the emirate of the 2022 tournament, he said by phone.

Change in favourites

The US, which competed to host the 2022 edition, is the even-money favourite to get the event if it’s taken away from Qatar, Gala Coral said on its website. South Korea is a 9-4 chance, followed by Japan at 4-1 and 8-1 shot Australia.

Fifa’s board awarded the hosting duties to the 2018 and 2022 events during the same vote. Russia won the 2018 tournament and Qatar, which Fifa’s reviewers said would be too hot to host it in the normal June-July period, was awarded the 2022 event.

The next World Cup starts 12 June in Sao Paulo. After the tournament ends, Fifa will make a decision on whether to re- schedule the 2022 games to the winter in order to protect players and fans from temperatures of as high as 50 degrees Celsius (122 degrees Fahrenheit).

Qatar’s stocks fell for a third day and bonds also retreated as concern deepened that the nation may lose the hosting rights, threatening tournament-related investment.

Qatar, holder of the world’s third-largest natural-gas reserves, plans to spend as much as $200 billion on projects including stadiums, roads and hotels as it prepares for the event.

Markets tumble

The benchmark QE Index tumbled 0.6%, bringing the three-day decline to 4.1%, to close at 13,142.69. The yield on Qatar’s 5.25% bond due January 2020 rose one basis point to 2.43% at 2:52pm. in Doha.

Fifa said two days ago that Garcia’s panel will issue a report in July into the possibility of corruption in the process.

“There might be re-voting and that’s all very negative news,” Hisham Khairy, the Dubai-based head of institutional trade at Mena Corp. Financial Services Llc, said by telephone on Tuesday. “Everyone is worried about it and everybody is reducing their positions.”

Bond sales in the country are off to the worst start in three years as companies from telecom provider Ooredoo QSC to developer Ezdan Holding Group take loans as banks flush with cash cut lending rates.

Stocks on Qatar’s main index have gained 41% in the past 12 months on speculation the country’s promotion to emerging-market status at MSCI Inc. would prompt inflows from investors tracking the index provider’s gauges. The upgrade, effective this week, may attract $649 million to the nation’s bourse, HSBC Holdings Plc said in a report 12 May. Bloomberg

More From LiveMint

image beaconimage beaconimage beacon