The outlook for 2023 is not pretty. Phrases like a “darkened” global economy, and “significant economic danger” appeared in the World Economic Forum Chief Economists’ Outlook survey that was revealed recently.
The effects of Covid-19 continue to linger, and Russia’s invasion of Ukraine remains a contributing factor to the sharp deceleration in global growth. In Malaysia, inflation continues to rise as the ringgit keeps getting hammered by the almighty American dollar.
Over RM1 billion will be spent on the upcoming general election, while money will also need to be set aside in preparation for the monsoon season that may see more areas being inundated this year.
Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz admitted that Malaysia will not be spared from the global economic slowdown next year.
What does this mean for Malaysian sports? In short, budget cuts.
All eyes will be on Budget 2023 that will be tabled on Oct 7 and the possible dissolution of Parliament soon after.
Funding is crucial next year as the country’s national athletes will compete in the SEA Games in Cambodia (May 5-17), and the Hangzhou Asian Games (Sept 23-Oct 8). This will build their momentum for the 2024 Olympics in Paris, France.
Healthcare and education are banking on more allocations, while businesses, especially small- and medium-sized enterprises (SMEs), will be expecting more help in the form of grants, subsidies, and tax relief from the government.
The tightening of the national coffers will certainly frustrate programmes that may have been lined up to prepare our national athletes ahead of the major Games.
Even more disconcerting is the fact that the possible shortage of funds from the federal and state governments, will affect the grassroots.
If massive layoffs take place, this will disrupt lifestyles and may see the population cutting down on social activities, namely sports. This would mean sports academies and venue operators losing patrons.
Those who are still in business continue to suffer from the after-effects of the pandemic. The RM3,000 one-off payment by the government did little to cushion the impact.
Associations at the state and district levels, that are already feeling the pinch, may find it tougher to secure sponsors. Football clubs, by virtue of having been “privatised”, cannot rely on funds from the state government or local councils. That money should be spent on caring for the wellbeing of the local communities in weathering tough economic times.
Business operators would have to lower their profits to ensure that more people will continue to play sports and remain loyal customers. Local councils can be proactive by gathering business owners, including those involved in sports, to sell and promote their products and services during council events like Car-Free Morning sessions or community leagues over the weekend. This would give struggling business owners the reach and access to a wider customer base.
Those hardest hit by the tough times would need an outlet to de-stress and forget about their worries, albeit for a short period of time. Sports would be the best way to do so.
Associations, at the district, state, or even national levels, would need to find ways to up their game in terms of administration and provide potential sponsors with a good reason why they should invest in them. They need to think like proper businesses – come up with a marketing plan, provide audited accounts, and embrace digitalisation.
Their athletes are their biggest assets. Their officials can turn into event organisers, as practiced by the Federal Territory Kuala Lumpur Athletics Association. This will give sponsors a return of investment and marketing opportunities.
Sports is no longer what it used to be. Gone are the days when officials could rely on handouts by the government or its agencies. In moving forward, it needs to generate its own income.
Stakeholders should also take advantage of the Kuala Lumpur Sports Industry Expo scheduled for Oct 6-9, in Bukit Jalil. It will serve as a good platform to gauge the sentiments of fellow industry players and learn best practices in navigating a potentially treacherous, and possibly stormy 2023.
In times like these, it’s best to forge good ties and work as a team – for industry players need one another, now more than ever.
History has shown how sports suffered when the world was hit by World War I, the Spanish flu pandemic in 1918, and World War II. This was when governments were forced to shift their resources to healthcare, the military, and initiatives to revitalise the economy. But sports eventually bounced back. And the same will happen.
The good thing is, thanks to the advancement of technology and modern tools, the rebound will be faster than before. But only if the right steps are employed.
It’s time to pivot again, this time, minus the restrictions imposed at the height of the Covid-19 pandemic.
This may very well be the beginning of a new era – where true professionalism will rise. Where serious industry players are able to stand on their own two feet, and not rely on taxpayers’ money.
