SOUTH Korea closed the Winter Olympics on Sunday with a spectacular ceremony, capping off two weeks of sport. Ivanka Trump was a guest.
With 3,000 athletes competing in 100 events, the multi-billion euro games have been a remarkable opportunity for the host nation to present a stable image at a time of geopolitical turbulence in the region. South Korea has presented a vision to international audiences of a modern, vibrant democracy, a prime destination for future investment and tourism. This was crucial, after tensions with its northern neighbour rose in 2017.
While the nuclear stand-off on the peninsula remains, the Olympics have brought about a highly unexpected
geopolitical dividend. That is, at least temporarily, relations between North and South have improved and — remarkably — the two sides even entered a number of joint teams at the games.
Two major questions will determine whether a financial dividend can be delivered to South Korea. Firstly, can a country’s reputation be enhanced in the same way a corporation’s can be? And, secondly, can this have a positive, significant, and sustainable national impact?
On the first issue, competition for the attention of stakeholders, such investors and tourists, is intensifying, and national reputation can be a prized asset or a big liability, with a direct effect on future political, economic, and social fortunes. Boosting a country’s reputation is an ever-common ambition in an overcrowded, global information marketplace, and a number of countries have successfully used the Olympics to positively differentiate themselves to the world, including Spain, post-the Barcelona, 1992 Olympics, and Australia, post-Sydney 2000.
Yet, many nations fail to fully capitalise, reputationally, politically, or economically, after hosting the Olympics, or other, major sporting events, such as the Commonwealth Games and football’s World Cup. One only has to recall legacy images of abandoned and underused, new-build Athens 2004 Olympic sports stadia, whose inflated cost contributed to Greece’s massive public sector debt, to appreciate that countries do not always get this right.
Moreover, ‘legacy-driven’ Olympics economic growth is often over-hyped. In 2012, for instance, Citibank found that, in nine of the last 10 summer games, GDP tended to rise in host nations in the run-up to the event, but then recede in the two quarters afterwards.
To maximise prospects of Korea benefiting, it must pursue a concerted reputational, political, and economic strategy, which aligns all key national stakeholders (across the public, private, and third sectors) around a single,
coherent vision for its country brand.
This exercise should not just be the preserve of tourism agencies, let alone government, but must involve the private and third sectors, too.
A good example here is the ‘New Zealand Way’ Initiative, which transformed global perceptions of that country in the 1980s and 1990s.
New Zealand was in the midst of a difficult economic climate, during much of the 1970s and 1980s, partly caused by the country’s loss of preferred trading status with the UK and the Commonwealth — amongst the nation’s then major export markets.
In this context, the New Zealand Way transformed perceptions of the country by building a destination brand for
outdoor sports and tourism, in part by leveraging the hosting of events such as the 1987 Rugby World Cup and the 1990 Commonwealth Games. Here, the untapped potential of the country’s natural environment was recognised, and subsequently showcased in films, such as the Lord of the Rings blockbuster film trilogy.
And it is no coincidence that the New Zealand tourism sector has enjoyed a long boom.
For instance, visitor numbers from the UK increased by 60% between 2001 and 2006. Building upon the growing
international appreciation of the country’s unspoiled natural environment, and in the face of the loss of its preferred trading status with the UK and the Commonwealth, New Zealand recognised that a strong country
reputation for quality agriculture and produce would be hugely beneficial, if it was to better compete in global markets.
The subsequent success of its agriculture sector, which has also become more competitive and efficient, is symbolised by the fact that it now accounts for around one third of global dairy exports — that is twice Saudi Arabia’s share of the world oil exports.
The New Zealand example underlines how even a relatively simple, unified country brand vision can be powerful.
To be sure, the country is not unique in having a beautiful, scenic environment, but it has captured the world’s imagination with its consistent branding. This has put outdoor pursuits and natural values firmly at its core, as
epitomised, for instance, by the ‘New Zealand 100% Pure’ slogan.
This is a lesson that South Korea would do well to learn quickly, as it seeks to capitalise upon the Olympics. As with New Zealand, a key part of this work must connect Pyeongchang’s hosting of the Winter Olympics to a wider story that showcases South Korea’s real strengths, as a nation, so as to increase favourability of international perceptions of the country, politically, economically, and socially.
Taken overall, the medium- and long-term impact of Olympic Games has frequently been overstated for host nations. However, after a difficult 2017, South Korea now has a key opportunity to use its hosting of the world’s largest sporting event for a positive brand makeover, which could produce a significant, lasting political, reputational and economic legacy for the country in years to come.