Showing posts with label golf in Brazil. Show all posts
Showing posts with label golf in Brazil. Show all posts

Wednesday, April 18, 2012

Should the Golf World Learn Spanish?

Men’s professional golf in South and Central America is about to take a leap forward with the launch of the PGA Tour Latinoamerica. With economic forecasts predicting that the region is going to be one of the most significant contributors to the growth in global trade, Tim Maitland looks at whether in the future the best investment the golf world can make is studying Spanish and Portuguese.



 For those in the golf industry who are still need to check their Mandarin phrase book before they can tell their一号木yi hao mu (driver) from their 推杆 tui gan (putter), the thought of learning a whole new language – or two given how Portuguese-speaking Brazil now boasts the world’s sixth largest economy – will be terrifying. It might be worth the effort.

 “Definitely! They definitely need to!” says Jhonattan Vegas, the 27-year-old Venezuelan whose remarkable 2011 rookie season on the PGA Tour has sparked one of the latest growth spurts in Latin America.

 “Obviously we’ve got great players, starting through the Argentineans, through Camilo Villegas and then me coming into the picture. I think it’s really growing; we’ve got a lot of kids with great potential coming up and I think they’re realising that it’s a dream that can come true, so I think it’s heading the right way.”

Almost everywhere one looks at the region there are reasons for optimism, but one can argue that they have been seen before and not amounted to as much as promised. It might have happened after Argentina’s Roberto De Vicenzo won the 1967 Open Championship and became the first Major winner from outside the traditional English-speaking golfing nations since Arnaud Massey of France in 1907. The game might have exploded at anytime from the 1950s through to the ‘80s when you could see players like Sam Snead, Arnold Palmer, Gary Player, Tom Weiskopf, Lee Trevino, Hale Irwin or Bernhard Langer winning anywhere from Panama through Argentina, Brazil, Mexico to Colombia.

The Olympics and Economics

The logic in suggesting that this time it’s different is two-fold. First, the return of golf to the Olympic Games in Rio de Janeiro in 2016 is opening doors for the game and, as we enter the four-year cycle post London 2012, opening the wallets of governments and national Olympic committees. Second, the economic predictions for the region are so positive it’s almost impossible to conceive of any reasons why golf won’t be along for the ride.

Earlier this year HSBC’s Global Connections Trade Forecast predicted that from 2012 to 2026 international businesses will increase global trade by 86 per cent to a total of US$53.8 trillion, but that trade growth in Latin America will be 30 per cent faster than for the rest of the world.

“If you take the emergence and development of golf in China as an example, it reappeared because Hong Kong and Chinese Taipei businesses started relocating their manufacturing bases to Southern China. From there came the investment in golf courses. It’s very hard to believe that, if the predictions for Latin America are proved correct, the growth in the economies and the influx of global business expertise won’t increase the demand for golf and that some of the investment flowing into the region won’t find its way into investment in golf” explains Giles Morgan, HSBC Group Head of Sponsorship, citing Brazil’s financial capital Sao Paulo and the 50-plus courses now in Sao Paulo State as an example.

Trade between Emerging Markets

It’s not just Brazil where growth can be anticipated. The same HSBC Global Connections Trade Forecast predicts that Peru and Panama will join Brazil in the top five Emerging Growth Importers between 2012 and 2016, and that Panama’s trade forecast will grow by almost 230 per cent in the next 14 years, fuelled by the scheduled completion of the widening of the Panama Canal and the development of shipping lanes to Singapore and between North and South America.

“What’s particularly intriguing for the golf world is where the new investment in golf in Latin America is going to come from. The reason the forecasts for trade growth are so high is because of the way trade between emerging markets is going to increase. China is going to overtake the USA as the world’s largest trading nation by 2016. It doesn’t take a huge feat of imagination to see the day when Chinese investors start putting their money into creating golf courses in the emerging markets they’re working in, because many of those investors are already engaged with golf in their own country,” explains Morgan.

Idols and Leaders

Unlike China, one of the main forces driving an increase in golf’s popularity in Latin America will be the performance of its stars. Whether it was Mexico’s Lorena Ochoa and her short but stellar career as the world’s undisputed number one woman golfer, Argentina’s Angel Cabrera winning the 2007 US Open and the 2009 Masters, Colombia’s Camilo Villegas heartthrob looks taking golf onto the front pages of his country’s newspapers for the first time, or Paraguay’s Julieta Granada snaffling the US$1 million prize at the ADT Championship in November 2006, much of golf’s progress into the public consciousness has been through the performances of a handful of the region’s successful pros.

“It’s very typical in our region; we’re very used to idols and leaders. That needed to happen in golf for the rest of the aspects to happen. I think all this starts with heroes,” explains Henrique Lavie, the Venezuelan former professional and current Commissioner of the Tour de las Americas, who will become Executive Director of the PGA Tour Latinoamerica.

How quickly that can work in the region is illustrated both by Granada and Vegas. Granada reckons she would be recognised by around one out of every five people in the streets of Paraguay’s capital Asuncion; “They say ‘Are you the one that plays the little white ball in the hole?’ It’s very funny!” she says.

Vegas is credited with bringing about an even bigger shift in attitudes towards golf in his native Venezuela. His victory at the 2011 Bob Hope Classic witnessed a significant change in rhetoric from Hugo Chavez, the socialist President of the Republic of Venezuela.

In late 2010 Reuters reported that Chavez stating that "You, bourgeoisie, should offer your golf courses," to flood victims. Months later, following Vegas’ first victory on the PGA Tour, AP was reporting Chavez saying in a televised speech "I'm not an enemy of golf. I'm not an enemy of any sport."

“I didn’t change his mind, I just gave him a different perspective of what the game is really about,” Vegas explains.

“It’s gone from people thinking it’s a rich man’s sport to a game that everyone can play; which is huge, because I come from a family that is not really wealthy.”

Male-Dominated

For the women, the story in recent times has been slightly different. Granada, points out that part of the problem for women’s golf in Latin America is that those players who do make it to the top don’t stay for long. Two South Americans won on the LPGA in 2005 - Colombia’s Marisa and Chile’s first LPGA player Nicole Perrot –neither are still on the tour.

In that context, it’s easy to understand why last year’s win for another Colombian, Mariajo Uribe, at the limited-field, two-round unofficial HSBC LPGA Brasil Cup in Rio de Janeiro was greeted with what would otherwise seem to be near hysteria. Uribe herself predicted it would make “a huge impact on South American golf”, while Rachid Orra, at the time serving his spell as the President of the South American Golf Federation and who is still the leader of the Brazilian Golf Confederation declared “Symbolically, the same thing” as Vegas’ PGA victory.

The two-day 30-player US$720,000 tournament in Rio, which this year is known as the LPGA Brasil Cup presented by HSBC, remains the highest profile women’s golf event in the region.

The Olympic movement offers the more immediate hope that things will improve. The International Olympic Committee has driven women’s participation in the Olympics up from 23 per cent in 1984 to 43 per cent in Beijing four years ago. Couple that with the fact that investment from NOCs and governments is estimated to be worth around US$200 million a year worldwide to a sport like badminton; even a small slice of that for women’s golf would be more than it has ever seen before and could hardly fail to create significant change.

“I hope the money brings that access and people just get organised and get it done; the money helps, that’s a big part of it,” Granada states.

Horses Not Courses

If we are looking at the beginning of a golf boom in South America, it’s not a result of an explosion in the number of courses. Up-to-date statistics are hard to come by, the most reliable recent figures being from a KPMG Golf Benchmark Survey in 2008, which reported approximately 550 courses in South America with an estimated 130 under construction. Almost half of those courses were in Argentina.

Brazil has grown significantly. According to the Brazilian Golf Confederation the number of golfers has more than tripled since 2000 to 25,000 players is a drop in the ocean compared to the 10 million that, economically, they could be reaching.

“The size of golf in South America is pretty much what it was 10 years ago. The size of golf, the number of courses and the number of golfers is pretty much what it was at that time,” reveals Duncan Weir, the R and A’s Executive Director of Working for Golf.

“I think there has been a rise in the prominence and achievement levels of the top players rather than a dramatic rise in the participation levels and facilities. The leading amateurs are getting easier access to the American colleges and people like Villegas and Vegas are examples of that. They’re being spotted early by US college coaches.”

Crossing the Andes on a Unicycle

The problem is that uprooting and going to the USA at an early age is pretty much the only option, not an easy one considering that poverty, not wealth, has been behind many famous careers: Puerto Rican World Golf Hall of Fame member “Chi Chi” Rodriguez started golfing with a tin can and a stick. Paraguayan veteran Carlos Franco grew up in a dirt-floored, one-room home. Angel Cabrera lived under two brick walls and a tin roof. Andres Romero’s story is similar; a family of 10 with two bedrooms and no running water.

This is where the importance of the Tour de las Americas’ impending merger with the PGA Tour becomes apparent. In the last four months of this year the newly created PGA Tour Latinoamerica will stage 11 events, with the aim of expanding to 16 to 18 tournaments, each with a minimum purse of US$130,000. It’s not the increase in prize money – this year players were competing for a share of US$40,000 at Chile’s Abierto de Golf Los Lirios and for just US$10,000 more in Peru – but the structure. With success, a golfer can play his way into Nationwide Tour stops and the two PGA Tour events played in the region. Finishing at the top of the Order of Merit will bring Nationwide Tour status for the lucky few. Potentially, that increases the chances of a golfer who can’t find his way to the States growing and maturing far closer to home.

“It’s not because they will receive more money; they will spend much less money, so it’s easier. This is the importance of this circuit,” states Rachid Orra, the Brazilian Golf Confederation’s President.

“The majority of players don’t have the money to go to the States and start playing there, so it’s very difficult. If they can start their career in South America it makes thing much, much easier,” he adds.

Investment + Opportunity = Growth

Just how far and how rapidly golf in the region develops from here depends on an infinite number of factors. The main driver could be the future success of the kids currently emerging from college, the impact of the Olympics or from the other end of the scale the demand caused by increasing numbers of expatriate recreational golfers and growing upper-middle classes. What is clear is that there is plenty of scope.

“I think the potential is huge. It’s a continent of not that many golf courses in total. If you want to do a broad comparison there are currently about the same number of golf courses in Scotland, which has about 540, as there are in all of South America,” says the R&A’s Duncan Weir.

Together with the opportunities the other key ingredient needed is finance.

“The predictions at both ends of the scale are for unprecedented growth. There is going to be unprecedented investment in golf at a national level worldwide because of the Olympics in Rio. There is going to be unprecedented growth in trade and in economies in the Latin American region in the foreseeable future, which past experience indicates will result in an increase in demand for, and availability of, golf facilities. There’s investment and there’s opportunity; combine those two together and the end result is growth. Creo sucederá al final!” explains HSBC’s Giles Morgan finishing with the Spanish phrase meaning ‘I believe it will happen in the end’.

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photo credit: randa.org

Thursday, June 23, 2011

Golf and Brazil's International Olympic Growth Potential (part 2)

 August 5th 2011 marks five years to go before Rio de Janeiro hosts South America’s first Olympics and golf returns to sports’ biggest stage for the first time since 1904. Tim Maitland looks at how the sport is evolving in Brazil as 2016 inches nearer, from building awareness in the sport to golf as an international business. Read the first segment here, What Will Olympic Status do for Golf in Brazil?


Building Awareness

Typically, tournament golf is one of the biggest drivers of awareness in any emerging golf market, but the days when Gary Player, Ray Floyd, Jerry Pate and Hale Irwin etched their names on the Aberto do Brasil or Brazil Open trophy in the 70s and 80s are a distant memory. And the European Tour’s Brazil Rio de Janeiro 500 Years Open and Brazil Sao Paolo 500 Years Open as part of the celebrations of Pedro Alvaras Cabral’s “discovery” of the country in 1500 did no more than mark the anniversary and quickly disappeared.

For the moment, it’s left to the limited-field unofficial HSBC LPGA Brasil Cup to fly the flag as the only truly international tournament. From a perspective of golf’s heartlands it might be hard to believe that a US $720,000 event could sustain the role, but the feedback locally says otherwise.

Rachid Orra, with his South American Golf Federation hat on, described the victory by Columbia’s Mariajo Uribe at the end of May over a field that included both Cristie Kerr and Suzann Pettersen, as being as significant to the region as Jhonattan Vegas’ victory at the Bob Hope Classic in January; even though Vega’s win has single-handedly changed Venezuela president Hugo Chavez’s attitude to the sport.

Mariajo Uribe

“Symbolically, it’s the same thing because it’s a girl that has beaten some of the best players in the world!” declares Orra.

“It’s very important for us. It’s an example for the young girls that want to play golf to see one girl from Colombia – a country like Brazil – can win a very important tournament. The coming of the HSBC LPGA Brasil Cup was a very important step for us, taken three years ago. This is another one. Both are very, very, very important.”

Before the event, Rio’s biggest newspaper, O Globo, shoved aside some of its wall-to-wall soccer coverage to give Pettersen and Kerr posing at a photocall on Botafogo beach prime position on the second page of its sport section, briefly relegating the news of Flamengo, Fluminense, Botafogo and Vasco da Gama. Such coverage of golf hasn’t been seen in recent memory.

It was fantastic. That helps a lot. I think the last time was back in the 70s when there were fewer things to cover and it got more space, but it was still very limited and very few people read newspapers at that time,” says Ribeiro.

“The HSBC LPGA Brasil Cup is a huge driver in terms of creating interest. People are not accustomed to seeing golf. The exposure on TV is very limited normally. The Majors and big championships are on just one cable channel or maybe on the Golf Channel, which is still very small. The HSBC LPGA Brasil Cup is covered by SporTV, which has five times more viewers than all of the channels that carry golf combined. Just with that we’re reaching five times the average audience for golf.”

Naturally, the LPGA is eager to expand its tournament, but the business of tournament golf is caught in the same Catch-22 in Rio; for events to grow there need to be more people who have got the golf bug, but to get the golf bug you have to get infected first, and for most people that means swinging a club somewhere…but where?

Counter-intuitively, one of the best ways of developing tournament golf in Rio de Janeiro may be to move out of Rio for the time being. One could argue that taking the seedling that is international tournament golf to the more fertile nursery of Sao Paulo, one of the biggest financial centres and richest cities in the world where there are almost fifty golf courses, would allow more rapid short-term growth. There, an event could forge closer links with the international business community, moving back to Rio as a more robust sapling once the opening of the new Olympic facility had created the significant increase in the city’s golf population that such an event needs.

Golf’s International Business

That’s not to say that relatively slow spectator growth has to hamper the development of the tournament as a whole. As Kotheimer explains, having the only international event in a sport that resonates with the international business community is a powerful tool to educate and inform potential clients about his business’s ability to cross borders.

We have a tournament with thirty golfers and if you look at the list of players you see a Canadian golfer, an Australian golfer, an Argentine golfer, Spain, Chile, the US, Brazil, England, Paraguay, Taiwan, Sweden, Columbia, Norway, and Korea. The global connectivity of this sport pretty much mirrors the connectivity of HSBC around the world. Our focus for our clients in Brazil is the connectivity between Brazil and China, Brazil and Mexico and so on. There’s an alignment with what golf is doing internationally with what we’re doing internationally,” he says.

Yet, even if Rio doesn’t solve its dilemma quickly, things are still evolving exponentially. It would be wrong to say that Olympic status has opened doors for the sport because, such is the elite nature of golf’s status in Brazil that most of the great and good were all ready members of Itanhanga or Gavea, but it has thrown golf right into the middle of much bigger conversations.

The landscape is changing, too. The Confederacao Brasileira de Golfe has just announced a domestic national tour, starting small with a plan for three events in 2011. By the end of the year the Tour de las Americas is likely to be absorbed into a far larger Latin American PGA Tour covering South America and the Caribbean and providing the region’s top players a direct route into the Nationwide Tour and, hopefully, following Brazil’s Alex Rocha and Jhonattan Vegas into the big leagues.

“It’s a big effort. It’s a very, very important thing, because it’s a new tour made for South America and the money-size of South American tournaments and with the help of the biggest tour in the world. It’s a big step. This will help to form new players and make them grow. We hope in the future we will have many Jhonattan Vegases and a Tiger Woods from Brazil,” Orra states.

High Society Meets the Favelas

Golf is reaching out, which given its high-end origins is one of the most impressive aspects of the way the sport is changing. Maria Priscila Iida is talking during a short break between helping teach groups of children from Rio’s favelas, the city’s infamous hillside slums and shanty towns, the day before the 2011 HSBC LPGA Brasil Cup at the Itanhanga course. The idea of clinics for disadvantaged children before a professional tournament is nothing new to the golf world, but it represents an enormous quantum shift in the mentality of the Brazilian golf community caused by Olympic status.

“This thing with the children is incredible. Who would have thought we could do something like this?” Iida asks rhetorically.

“Most of the golf courses are private; if you came here nobody would let you through the gates, but now they’re calling out and trying to make something bigger.”



Photo credit: PGA.com
1959 Brazil Open Golf Championship Medal Commemorative on eBay


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Wednesday, June 22, 2011

What will Olympic status do for golf in Brazil?

August 5th 2011 marks five years to go before Rio de Janeiro hosts South America’s first Olympics and golf returns to sports’ biggest stage for the first time since 1904. Tim Maitland looks at how the sport is evolving in Brazil as 2016 inches nearer.

From Rio de Janeiro’s perspective, the final piece of the Olympic jigsaw was put into place in June when, during the IOC Coordination Commission’s visit, the decision to build a new course in Barra da Tijuca, rather than to refashion the nearby Itanhanga Golf Club, was made. For the Rio 2016 Organising Committee it meant that the venue master plan was complete.

With the five-years-to-go point upon us, it gives golf fans a clearer picture of what golf in the Olympics will be like, with the International Golf Federation still working on the qualification premise it presented to the Olympic family when it successfully made its bid for inclusion in 2009: the top 15 men and women in the world rankings (with a limit of four per country) will be there, with the rest made up by working down the rankings with a maximum of two players per country until the sixty-player field is filled.


Rio Olympics
2016 Olympics in Rio

Concerns about whether all of the top players will take their places in the field in 2016 are frequent and, now at least, may seem relevant. One suspects that will be a moot point by the time the Games arrive for the simple reason that the entire multi-billion dollar global golf industry – players, tours, the International Golf Federation, golf courses and the golf apparel and equipment brands – all need the injection of renewed interest a successful Olympics will provide, especially in the wake of the Credit Crunch.

So what will Olympic status do for golf in Brazil? Well, just as for the golf world in general, the opportunity is far greater than two four-round Olympic events; it’s already put golf into a whole new stratosphere of Brazilian sport.

After the IOC decided golf will enter in the Olympic Games, things have changed completely in Brazil,” says Rachid Orra, the President of the South American Golf Federation (the Federacion Sudamericana de Golf) and of the Brazilian Golf Confederation (the Confederacao Brasileira de Golfe).

Golf in Brazil was growing steadily every year, but now with this new opportunity and with golf returning to the Olympics here in Rio de Janeiro, things are changing dramatically. Even the Brazilian government is interested in helping us develop golf in Brazil. It’s an opportunity that we have to take very seriously in order to take profit… to give big steps in the development of golf. The investment in money is not yet significant, but I’m sure this will grow very fast in the future.”

Hosting two successful tournaments is of paramount importance for Rio and Brazil but, as Brazil’s former LPGA player Candy Hannemann puts it, that is just part of a far bigger aim.

“It’s a project. Our goal is not just the 2016 Olympics. It is “how can we help the 2016 Olympics kick-start more of a golf tradition in the country? And then how can we go on from there?” I think the project is more than just 2016,” says the 32-year-old Hannemann, who played for five years on the LPGA until a wrist injury forced her off the tour in 2008.

Things are already changing…starting with attitudes. That’s beautifully summed up by another female professional, Maria Priscila Iida. A third-generation Japanese-Brazilian, Iida talks of moving to Japan eight years ago without a word of Japanese and experiencing a vastly different rural world to the megacities of Tokyo, Osaka and Nagoya that she had envisaged. However her tone of incredulity is just as strong when she describes coming back for the first time in six years to play the 2010 HSBC LPGA Brasil Cup.

“I had culture shock backwards. Everything was different. There are so many celebrities playing golf right now and you see it in the magazines. It is like, “What is this? Everybody knows about golf now?” I played with a Brazilian actor last year and learned that Formula 1 driver Rubens Barrichello takes lessons with my ex-coach,” explains the 32-year-old Iida, who played with Hannemann in Brazil’s junior national team before either reached their teens.

“The way I hear things it’s becoming much bigger. You can’t count the golf courses anymore; there are so many. They’re golf courses one here and one there. It’s bigger and it’s growing,” she adds.

Rio’s Dilemma

Rio’s challenge is that the Japeri Golfe Clube, the only public facility in the entire city, it is losing two of its nine holes because of road expansions prior to the Olympics. The other two golf courses, Itanhanga Golf Club and Gavea Golf and Country Club, are the high-end private members facilities.

“It’s a Catch 22!” says Candy Hannemann.

“It’s like the chicken and the egg story. Without the egg you don’t have the chicken, without the chicken you don’t have the egg,” echoes Enio Ribeiro of Brasil1, the biggest of the country’s sports marketing companies involved in the golf industry.

“There needs to be people playing for somebody to invest in it, but nobody will play unless there is a place to play,” Hannemann continues.

“Here the investment needs to come with a leap of faith; a belief that the game’s going to grow and be marketed in a way that will bring the game to the mass, because that’s when golf becomes big. We could have thousands of people out there with the potential to be PGA or LPGA golfers but we don’t know they have the talent because they don’t have the access to it,” she points out.

Right across the board in Rio there’s a consensus that the issue of accessibility to the sport needs to be solved if golf is going to benefit from the Olympics.

“The most important thing is the facilities. That’s simple math. Brazil has 200 million people and only 25,000 golfers. Argentina has 50 million people and 200,000 golfers. Because of the economy we definitely have around 10 million people that could play golf. What we need to do is have facilities that can allow them to try it,” says Ribeiro.

“We need some big magic…not magic…we have to work harder,” adds Rachid Orra.

“It would be easier if we had a lot of public courses to put a lot of people from schools directly into playing golf, but the Brazilian reality is not like this so we have to work 10 times harder than in America for instance. We need much more driving ranges here. Brazil has a lot of land. The major new courses are the resorts, the hotels further out of the cities. In the Northeast of Brazil, the greater part of the new hotels in Brazil are planning golf courses. Tourists like to play golf in Brazil; it’s an economic need, which is good for golf in Brazil.”

The good news from Rio’s point of view is that, with almost every major stakeholder in golf engaged in the process of preparing for the Rio Games, help is more available than it has ever been in finding the fix to the Catch 22 issue.

“Everyone from here, that’s what they want to talk about: every single one of them. It’s a vicious cycle that we have to figure out how to break, and we can. It’s more about awareness,” says Jane Geddes, a two-time major champion and chairman of the International Golf Federation, during a short break between meetings arranged for her trip to the HSBC event.

Thriving Economy

Historically, the kind of investment golf needs has been an issue in Brazil where spiraling inflation prohibited long-term projects, but since 2000 the number of golfers has increased from 6,000 in that year, stabilising in more recent years at around 25,000. The number of courses has increased too in those 10 years, up nearly 25% to 110, while another 30 are under construction, but as Rachid Orra mentioned, some of that growth is far away in sparsely populated states like Bahia and Pernambuco catering only for European tourists a surprisingly short six-hour flight away.

The fact that this development is happening at all is a product of a period of growth that has seen Brazil develop into one of the world’s top 10 economies by gross domestic product.

“The economy in Brazil for the past 10 or 15 years has really been a stable economy and one where you see significant amount of foreign investment for a variety of different projects. One of the largest offshore oil finds in recent history, the Topi oil field, is offshore of Rio so there’s a lot of investment taking place in the oil and gas industry in and around Rio. Similarly in other parts of Brazil; investments in agriculture, investments in other industries are taking place,” explains David Kotheimer, Vice President of HSBC Bank Brasil.

“The economics are there. The financing capability is there. The economy in Brazil is there. From a demographic perspective, you see more and more people improving their socio-economic condition year-on-year and that’s predicted to continue over the next 30 years. The prosperity in Brazil is continuing to increase. The stability, you’ve had that in the Brazilian economy for a long time now and that’s why HSBC is here; we’re helping with that growth and we’re making those types of loans to companies that need to invest. That will continue on. I think the stability is there and the financing is there; it’s having a sufficient demand for that type of investment in a driving range or golf course,” Kotheimer adds.

So the financial climate ripe, and the socio-economics suggest a significant sector of Brazil’s population are in the process of moving into the level of wealth where golf becomes aspirational. Growing and meeting that demand, which you could break down as a combination of awareness and opportunity, stand hand-in-hand as Rio’s big obstacles.

The second part of Tim Maitland's article, Golf and Brazil's International Olympic Growth Potential, will be posted tomorrow is now posted on Golf for Beginners blog.

Photo credit: StanfordReview.org


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