This summer Tokyo Olympics could lead to billions of dollars in losses for Japan as costs continue to rise.
Funding for stadium renovations, athlete accommodation, and event marketing has cost more than $20 billion in estimated costs for the delayed Tokyo 2020 Olympics, making it a one of the most expensive Olympics in history.
But it doesn’t lose gold.
The 2014 Winter Olympics in Sochi were the most expensive, followed by this year’s Tokyo Summer Olympics, According to an Oxford University paper. Of course, the total costs associated with this year’s Olympics are still estimates, per The Wall Street Journal, and a clearer picture of Japanese spending will be available in the coming weeks as the international competition ends.
It is important to note that the expenses for the Olympics listed here are “sport-related expenses”. These include things like stadium construction, ceremonies, and other operational costs, like workforce and food service.
Olympic Games Organizing Committee (OCOG) non-sports activities do not count towards official expenditure. This “non-OCOG indirect costs“This includes building roads, rails, airport infrastructure and upgrading hotels, which are also involved in hosting the Olympics.
And these costs are often lower than the official sports-related costs of the Olympics – but the benefits can be reaped after many years.
For example, the 2008 Beijing Olympics had sports-related costs of $6.8 billion, but China’s total spending was about $42 billion due to external costs. These costs range from a $3 billion airport terminal to $30 million spent on plants and flowers, according to the report. WSJ.
Host governments will advertise that in addition to the revenue shortfall of the Olympics, hosting the Games will enhance the economy by creating jobs, boosting tourism and adding needed infrastructure set. These measures are more difficult to quantify, and several studies have found these claims about hired employees and travel more ambiguous.
In fact, it took Montreal decades to pay off the borrowed money to build an Olympic stadium for the 1976 games – what was eventually dubbed the Big Owe. And the cost of the 2004 Athens Olympics has been linked with the Greek debt crisis.
OCOG has budgeted for a projected revenue of $6.7 billion for the Tokyo Olympics, much less than the estimated $20 billion cost.
But if the Olympic Games are canceled, the International Olympic Committee will have to nearly 4 billion dollars back for its broadcast partners.
https://www.marketwatch.com/story/how-the-tokyo-olympics-ranks-among-the-most-expensive-games-of-all-time-11627050433?rss=1&siteid=rss | Cost of the Olympics: How the 2020 Tokyo Games are one of the most expensive ever