News / Europe

Money Spent on Sochi Games Raises Questions

An aerial view from a helicopter shows the Olympic Park in the Adler district of the Black Sea resort city of Sochi.
An aerial view from a helicopter shows the Olympic Park in the Adler district of the Black Sea resort city of Sochi.
The flame will be lit later this week to open the 2014 Winter Olympics being staged at the Russian Black Sea resort city of Sochi.
But behind the pomp are many questions as to why this is the most expensive winter games ever held, whether the spending is justified and who is personally benefiting.
Take a warm place with palm trees with mountains nearby and pour the astounding sum of more than $50 billion into it. And there, on the Russian shore of the Black Sea, the venues and infrastructure for the 2014 Sochi Winter Olympics are ready to open this week.
Olympic Games are often linked to the will of political leaders of the host nation. And under the watch of President Vladimir Putin, Russia poured massive amounts of capital into Sochi.
Russian scholar Leon Aron wrote recently on the American website Politico, “In putting his Winter Olympiad near a beach resort, Putin seems to be possessed of what might be called the ‘Peter the Great’ complex: emulating the Tsar who built his capital, from scratch, from a swamp.”
No other Winter Olympics has ever cost this much. The 2010 games in Vancouver, Canada totaled roughly $7 billion. That’s less than one seventh what Sochi has cost.
Most of Sochi’s infrastructure to support the games had to be built from scratch. Not just the main stadium and other sports venues but also the Olympic athlete’s housing and new hotels for spectators.
Roads, electrical infrastructure and sewage treatment facilities were enlarged.
There is also an advanced technological infrastructure to handle the massive demands imposed by presenting – and covering - the games in this digital age.
Costs questioned
The costs have raised many questions from activists demanding accountability and justification.
Putin said that a review in 2012 by the Russian government’s Audit Chamber found some $500 million in cost overruns that reflected what he termed the honest mistakes of investors who underestimated the costs of construction.
In the wake of that audit, three criminal investigations were launched against employees of Olympsrtroy, the state company responsible for the creation of Sochi 2014. But no court actions have reportedly been taken.
Critics allege corruption.
In a 2013 report, titled “Winter Olympics in the Subtropics: Corruption and Abuse in Sochi,” Russian opposition politician Boris Nemtsov slammed the massive spending.
He alleged that out of the more than $50 billion spent on Sochi, “the total scale of the embezzlement is about $25-30 billion or about 50-60 percent of the stated final cost of the Russian Olympics.” 
Putin dismissed the report, saying “If anybody has got this information, please show this to us. But so far, we haven’t seen anything except speculation.”
Another critic is Alexy Navalny. The anti-corruption activist has created a website – – that spotlights not just the costs but also benefactors of the spending.
The examples cited include the main 40,000-seat Fisht Olympic Stadium.
First projected to cost about $49 million, Navalny said the real final cost could well exceed $520 million and may total more than $700 million. He said the stadium’s main contractor, Ingeokom, has a history of massive cost overruns and completion delays.
Ingeokom was also the contractor that completed the Iceberg Skating Palace at the games at a total cost that Navalny’s website said came to over $272 million – two and a half times what the activist claims it should cost.
Navalny also alleged cost overruns with the construction of the railway and highway linking the resort of Adler in the coastal area to the mountains of the Krasnaya Polyana region, where skiing events will be held.
Navalny’s site says the total cost of the transportation link came to $8.7 billion, nearly twice what was anticipated, and exceeding the total cost of the 2010 Vancouver Winter Olympics.
Another new highway in Kurortnyi that is 17 kilometers long and built to get people to and from Olympic event came in well over projections at $2.5 billion, Navalny said.
The Olympic hockey rink will have seats for 7,000 spectators.  The cost of building it, $104 million, is said by Navalny to equal the cost of 3,400 regular Russian hockey facilities.
Links to Putin alleged
Media reports have questioned the links of the construction projects to prominent Putin loyalists.
That Shayba hockey rink was built by contractor Igor Nayvalt, who is reported to be well connected to the Ozero cooperative society. One of the significant shareholders of Ozero is Putin.
Also connected to Shayba, according to the publication Forbes Russia, is Ural Mining and Metallurgical Company President Iskander Makhmudov, and his junior partner - billionaire Andrei Bokarev.
Forbes Russia also reported that billionaire Arkady Rotenberg, the Chairman of SMP bank and a friend of Putin since childhood, landed $7.36 billion in state contracts connected to the Sochi games. 
A group called the “Anti-Corruption Foundation,” led by former bank manager Vladimur Ashurkov, said three close Putin associates including Rotenberg benefited from the construction of a rail line. It named Gennady Timchenko, a partner in SK Most Construction Company and the head of Russian Railways, Vladimir Yakunin.
Despite the questions about the construction, the Russian government has had little response. Said opposition politician Nemtsov: “Not a single criminal case of fraud, embezzlement, bribe-taking, or kickbacks has reached the courts.” 

Maria Kovalskaya contributed to this report.

Sochi's Olympic venues:

  • The Bolshoy Ice Dome illuminated at night in Sochi.
  • An aerial view from a helicopter shows the Olympic Park in the Adler district of the Black Sea resort city of Sochi.
  • The Iceberg skating arena and Fisht Olympic stadium in Sochi.
  • An inside view of the Adler arena speed skating venue in Sochi.
  • The RusSki Gorki Jumping Center in Sochi.
  • The Rosa Khutor ski resort, of Sochi.
  • An aerial view from a helicopter shows hotels and residential houses constructed for the 2014 Winter Olympics in the Adler district of Sochi.
  • The Bolshoy Ice Dome, Iceberg skating arena and the Fisht Olympic Stadium, Sochi.
  • The Sanki Sliding Center, east of Sochi.

Jeffrey Young

Jeffrey Young came to the “Corruption” beat after years of doing news analysis, primarily on global strategic issues such as nuclear proliferation.  During most of 2013, he was on special assignment in Baghdad and elsewhere with the Special Inspector General for Iraq Reconstruction (SIGIR).  Previous VOA activities include VOA-TV, where he created the “How America Works” and “How America Elects” series, and the “Focus” news analysis unit.

You May Like

Video Russia’s Syrian Escalation Tests Obama’s Crisis Response

Critics once again question whether president has been slow to act on Syrian conflict, thus creating opening for powers like Russia More

Ancient African DNA Shows Mass Migration Back Into Africa

First genetic analysis of ancient human remains in Africa suggests massive migration from north around time of Egyptian empire More

NASA: Pluto Has Blue Sky

New photos also reveal the presence of water ice More

This forum has been closed.
Comment Sorting
by: Geoffrey from: kenya
February 03, 2014 1:49 PM
corruption is widespread across the EU in procurement esp among constructors(162billions) Russia is no saint.just politics.admit Putin is doing a good job.trillions lost in Iraq or that was Bush the Great,eh!this warped world!

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Hungary Criticized for Handling of Refugeesi
Henry Ridgwell
October 08, 2015 8:02 PM
Amnesty International has accused Hungary of breaking multiple international and European human rights laws in its handling of the refugee crisis. As Henry Ridgwell reports, thousands of migrants and refugees continue to travel through the Balkans to Hungary every day.

Video Hungary Criticized for Handling of Refugees

Amnesty International has accused Hungary of breaking multiple international and European human rights laws in its handling of the refugee crisis. As Henry Ridgwell reports, thousands of migrants and refugees continue to travel through the Balkans to Hungary every day.

Video Iraqi-Kurdish Teachers Vow to Continue Protest

Sixteen people were injured when police used tear gas and rubber bullets to disperse teachers and other public employees who took to the streets in Iraq’s Kurdish north, demanding their salaries from the Kurdish Regional Government (KRG). VOA’s Dilshad Anwar, in Sulaimaniya, caught up with protesting teachers who say they have not been paid for three months. Parke Brewer narrates his report.

Video Syrian Village Community Faces Double Displacement in Lebanon

Driven by war from their village in southwestern Syria, a group of families found shelter in Lebanon, resettling en masse in a half-built university to form one of the biggest settlements of its kind in Lebanon. Three years later, however, they now face being kicked out and dispersed in a country where finding shelter as a refugee can be especially tough. John Owens has more for VOA from the city of Saida, also known as Sidon.

Video Bat Colony: Unusual Tourist Attraction in Texas

The action hero Batman might be everyone’s favorite but real bats hardly get that kind of adoration. Put more than a million of these creatures of the night together and it only evokes images of horror. Sarah Zaman visited the largest urban bat colony in North America to see just how well bat and human get along with each other.

Video Device Shows Promise of Stopping Motion Sickness

It’s a sickening feeling — the dizziness, nausea and vomiting that comes with motion sickness. But a device now being developed could stop motion sickness by suppressing certain signals in the brain. VOA’s Deborah Block reports.

Video Making a Mint

While apples, corn, and cranberries top the list of fall produce in the US, it’s also the time to harvest gum, candy, and toothpaste—or at least the oil that makes them minty fresh. Erika Celeste reports from South Bend, Indiana on the mint harvest.

Video Activists Decry Lagos Slum Demolition

Acting on a court order, authorities in Nigeria demolished a slum last month in the commercial capital, Lagos. But human rights activists say the order was illegal, and the community was razed to make way for a government housing project. Chris Stein has more from Lagos.

Video TPP Agreed, But Faces Stiff Opposition

President Barack Obama promoted the Trans-Pacific Partnership on Tuesday, one day after 12 Pacific Rim nations reached the free trade deal in Atlanta. The controversial pact that would involve about 40 percent of global trade still needs approval by lawmakers in respective countries. Zlatica Hoke reports Obama is facing strong opposition to the deal, including from members of his own party.

Video Ukranian Artist Portrays Putin in an Unusual Way

As Russian President Vladimir Putin was addressing the United Nations in New York last month, he was also being featured in an art exhibition in Washington. It’s not a flattering exhibit. It’s done by a Ukrainian artist in a unique medium. And its creator says it’s not only a work of art - it’s a political statement. VOA’s Tetiana Kharchenko has more.

Video Nano-tech Filter Cleans Dirty Water

Access to clean water is a problem for hundreds of millions of people around the world. Now, a scientist and chemical engineer in Tanzania (in East Africa) is working to change that by creating an innovative water filter that makes dirty water safe. VOA’s Deborah Block has the story.

Video Demand Rising for Organic Produce in Cambodia

In Cambodia, where rice has long been the main cash crop, farmers are being encouraged to turn to vegetables to satisfy the growing demand for locally produced organic farm products. Daniel de Carteret has more from Phnom Penh.

Video Botanists Grow Furniture, with Pruning Shears

For something a bit out of the ordinary to furnish your home, why not consider wooden chairs, crafted by nature, with a little help from some British botanists with an eye for design. VOA’s Jessica Berman reports.

VOA Blogs