ECONOMY

Recent Olympiads have brought important long-term economic benefits to organizers

With a proper strategy and good organization, countries staging the Olympic Games can reap economic benefits, and not just on a short-term basis, a study by the Athens Chamber of Commerce and Industry (EBEA) concludes. According to the study, which deals with the Olympics of the last two decades, the Games staged by Seoul in 1988 are considered the main factor behind the reduction of South Korea’s public debt and led to a rapid rise in the country’s tourism receipts, growth of its sports goods and entertainment industries, and development of its electronic and telecommunications technology sectors. Korean trademarks have become world-known, which has offered a significant boost to its imports. Ahead of the Games, South Korea freed its currency and capital market of controls, while feared negative effects, such as galloping inflation or an economic recession, did not materialize. As a result of the buoyant growth of its economy, South Korea today is facing pressure from the US and European countries for a liberalization of its economy. The EBEA report also notes the significant economic impact of the Barcelona Games of 1992. The direct investment between 1987 and 1992 was estimated at $16.6 billion, amounting to 82.4 percent of the total cost. Unemployment in the city fell from 18.4 percent in October 1986 to 9.6 percent in July 1992. The Games generated income estimated at 2.85 trillion pesetas, or about three times the direct investment or 0.9 percent of the gross domestic product of the Spanish economy. Although the Atlanta Olympiad of 1996 was considered the epitome of commercialization, the EBEA report notes that the organizers’ targets were largely attained. The benefits, both short- and long-term were considerable in terms of the net gain in total production, incomes and the level of unemployment. The economy of Georgia received a boost of $2.6 billion from the organizers and a further $2.5 million in the form of spending by tourists. A total of about 77,000 of full- and part-time jobs were created, while Georgia’s treasury is estimated to have received $176 million. On a long-term basis, the benefits included the international promotion of Atlanta as an attractive city for sports events, conferences and tourism. A number of business deals were concluded on the sidelines of the Olympics. Sydney The report notes that the organizers of the Sydney Olympics of 2000 targeted the city’s industrial development, the attraction of investment and the promotion of the city as a tourism destination. The government of New South Wales set up the most representative program of business promotion in the framework of the Olympic Games. The Australian Technology fair promoted more than 300 local innovative technologies which brought in sales worth $288 million, while the Australia Business Center provided a host of opportunities through the Internet. New investment exceeded $600 million, supported by a post-Olympic strategy program, which helped in the construction of sports infrastructure projects. More than $1.9 billion was spent on sports installations and infrastructure projects, $1.1 billion came from private capital, while the completion of the main transport network and other projects upgraded Sydney. The Games provided a huge boost to Australian tourism and retailing. Revenue exceeded $6.1 billion, while about 1.6 million tourists spent an estimated $6 billion in 2001. A further $203 million flowed in during planned business events after October 2000, a month after the Games. Sponsorships yielded another more than $280 million.