In the first 15 years after construction of Latvia’s new National Acoustic Concert Hall it will earn Latvia’s national economy a total of EUR 107.6 million, fully compensating investments and creating additional profits of EUR 17.6 million, as concluded in Latvia’s Culture Ministry’s ordered social-economic analysis.
According to estimates, the concert hall project’s economic viability index is 23.6%. The project is considered economically beneficial to society if the index exceeds 5%. The concert hall’s economic net present value or economic worth in absolute terms is EUR 107,616,679. For a project to be considered beneficial, this index needs to exceed zero. The third reviewed index is benefit-cost ratio, which needs to exceed one – the concert hall’s index is 2.6, explains Culture Ministry.
Calculations were performed with the thought in mind that the concert hall would be built on AB Dam and would be commissioned before 2030 with total capital investments worth EUR 91.4 million. In a single year events organized at the concert hall will be attended by approximately 350,000 people, the ministry predicts. The concert hall would gain income from tickets and renting space to third persons.
The concert hall is also expected to become a popular tourism destination, which could bring another EUR 92.3 million. It is expected that among visitors of the concert hall, which could reach a number of 150,000 annually, 12.5% would come from Latvia, 12.5% from foreign countries, and 75% from Riga and Pieriga. As for attendants of international conferences – around 73,500 people annually – 25% of them would be local residents and 75% foreign delegates. It is estimated that approximately 126,500 would attend other events organized at the concert hall.
The concert hall project will create 75 new jobs, thereby creating additional PIT income worth EUR 1.6 million, according to the study.
In addition, the study analyzed social-economic benefits and losses not evaluated in monetary terms. Expected benefits include improved quality of life, as well as increased market value of real estate property around the concert hall.
As losses, experts surveyed possible increase of cargo vehicles moving in an out of the area. However, it is not expected to create traffic congestion problems for residents or create additional time or travel costs. (BNN/Business World Magazine)