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Friday, 17 May, 2002, 12:11 GMT 13:11 UK
World Cup win 'could bring share falls'
England players celebrate 1966 World Cup victory
1966: Good for English football, bad for British shares
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By Mike Verdin
BBC News Online business reporter
line

Worried about economic prospects? Concerned about the distinctly sub-Arsenal performance of your share portfolio?

Then hope that the England football team's Beckham-boosted fortunes wear off half way through the World Cup.

While a successful cup campaign may boost national pride, it could wreak havoc on Britain's economic welfare, analysis by Halifax bank has suggested.

"Our research shows that the World Cup feelgood factor sadly appears to be a myth," said Martin Ellis, Halifax group economist.

Long term record

The two tournaments since 1950 in which England progressed beyond quarter final stage were in years when the UK slipped low in the global economic league, Friday's report shows.

David Beckham outside 10 Downing Street, home of British Prime Minister Tony Blair
David Beckham: Limped to photo shoot

In 1990, when England reached the semi-finals, the UK economy grew at a one-paced 0.8%, one third of the average rate.

Yet in years when the England team was knocked out in the quarter finals - as it was in 1954, 1962, 1970 and 1986 - the economy grew by, on average, a twinkle-toed 3%, well above its long-term trend.

World Cup years have also proved treacherous for the London stock market, with share prices falling by an average of 0.5%.

The slide topped 1.5% both in 1990 and in 1966, the year England won the cup.

Political games

Not that MPs have been slow to attempt to harness football fever for political ends.

No sooner had manager Sven Goran Eriksson revealed the 2002 World Cup squad than they were marched (or limped, in the case of injured captain David Beckham) to Number 10 Downing Street for a photo session with Prime Minister Tony Blair.

Opposition leader Iain Duncan Smith, who it emerged is a season ticket holder for Tottenham Hotspur, was seen last week playing football in a charity five-a-side tournament.

In Germany, Chancellor Gerhard Schroeder, facing elections in September, is reported to have supported plans to offer workers time off to watch World Cup matches.

All are following in a time-honoured tradition dating back to at least 1966, when then prime minister Harold Wilson famously boasted: "England only wins the World Cup under Labour."

'Bunk it like Beckham'

Not so well recorded is the 17% plunge in major London shares in the six months following the tournament.

And with firms braced for soaring absences during this year's tournament, as employees "bunk it for Beckham" to watch England matches, an inverse link between factory floor and on-the-pitch performances may come as little surprise.

Indeed, one politician notable for his absence from the footie photo shoots has been Chancellor Gordon Brown, for whom a slowing economy would present problems in funding huge increases in public spending.

Perhaps the survey last week which showed that only one third of Scots would be supporting England's World Cup team reflected not "Auld Enemy" rivalry, but a canny investment sense.

See also:

14 May 02 | Business
Pru gives in to World Cup fever
09 May 02 | Business
World Cup prompts marketing spree
01 May 02 | Other News
World Cup goes online
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