News / Economy

Rising Cost of Olympics Begs Question: Why Host?

Rising Cost of Olympics Begs Question: Why Host?i
X
February 04, 2014 8:40 PM
With the Winter Olympics beginning this week, the world’s attention is turning to Sochi. But when the athletes and tourists leave, Russia will have spent more than $50 billion to stage the games. As the costs soar, VOA’s Brian Allen explores the benefits and pitfalls of hosting an Olympics.
Brian Allen
With the Winter Olympics beginning this week, the world’s attention is turning to Sochi. But when the athletes and tourists leave, Russia will have spent more than $50 billion to stage the games. As the costs soar, it is worth noting the benefits and pitfalls of hosting an Olympics.

When the Olympic flame arrives in the seaside town, all eyes will be on seven brand new facilities along the coast, and a new, world-class ski resort in the nearby mountains.

For 17 days, the world’s best winter athletes will dazzle and inspire.

But when the last medal has been handed out and the closing ceremony is over, Russia will be left with a monumental problem: paying off the most expensive Olympic Games in history.

The issue of exorbitant Olympic expenses is nothing new. The 2004 Summer Games in Athens cost an estimated $11 billion, partially contributing to the country’s on-going debt crisis.

Sochi, RussiaSochi, Russia
x
Sochi, Russia
Sochi, Russia
Spending soars

The 2008 Summer Olympics in Beijing, believed to have cost about $40 billion, included construction of the mammoth Beijing National Stadium - nicknamed the Bird’s Nest - which now sits mostly unused.

Six years later, the cost to stage the Sochi Games is estimated to top $50 billion.
Given the skyrocketing costs of the Olympics, the question is: why host?

Bob Sweeney, who leads DC2024, a group aiming to bring the 2024 Summer games to Washington, D.C., said, “Great cities gotta do great things, and this is the greatest of great things in the sports world.”

Lisa Delpy Neirotti, a professor of sport management at George Washington University, explained that hosting is about more than money.

“For each host city and each host country, they have their own objectives - what are they looking to get out of it? So for Sochi, they wanted to build a first-class ski resort, and to let people know Sochi is part of Russia, and that it is a summer and winter destination," she said. "For London, they wanted to redevelop the East End. When New York was bidding, it was primarily to get a new stadium for the [NFL's New York] Jets and Giants [American football teams]. They knew this would be the catalyst to get it built, and there would be some funding coming in. Every country and host city has a reason for doing it, and they aren’t all the same.”

Delpy Neirotti added that determining the actual cost of hosting an Olympics is difficult to quantify. She estimated the actual cost to put on the games is "only" about $3 billion, and includes expenses such as transportation and security.  

“That, unto itself, is paid mostly by Olympic sponsorship and broadcast dollars. The other additional amounts that are being thrown around, that’s all civic development," she said. "Think about the four-lane highway that went up to the mountains, or the high-speed train, and the seven new venues that are in an area of Adler that never existed before. If you didn’t have to build all of that infrastructure, your Olympic budget would be very reasonable.”

Strategic planning

Furthermore, Delpy Neirotti said the Olympics do not necessarily have to be a huge financial burden - as long as host countries plan ahead appropriately.  

“Often time you receive money that may have been slated for 10 years in advance, and you move that government money up," she said. "I think if you do it right, you don’t have to outlay that cash. You can secure it from sponsors, the broadcast rights, and money that is earmarked for the community at a future date.”

She added that the onus is on the IOC to select the candidate city with the most responsible plan.

“The International Olympic Committee needs to take a closer look on analyzing the corruption factors, the quality of life factors, and really understand that even though a country may say, 'It’s great. We can do it. We want it,' is it really good for the International Olympic Committee to burden this country with this responsibility," asked Delpy Neirotti.

Sochi, she said, is not an example of “hosting the right way.”

“Sochi is an outlier. It’s very rare that the International Olympic Committee gives a Winter Olympics to an area that doesn’t [already] have a ski resort,” she said.
The 2016 Summer Olympics in Rio de Janeiro are projected to come in at $14 billion, far less than the summer games in Beijing and what Russia has spent for Sochi. Traditionally, however, these early projections increase right up until the opening ceremony.

  • Russian speed skaters train at the Adler Arena Skating Center ahead of the 2014 Winter Olympics in Sochi, Feb. 5, 2014.
  • Russia's Tatiana Volosozhar and Maxim Trankov practice their routine at the figure stating practice rink ahead of the 2014 Winter Olympics, Feb. 5, 2014.
  • A woman poses with the Olympic rings in Olympic Park as preparations continue for the 2014 Winter Olympics, Feb. 5, 2014.
  • Hidenari Kanayama of Japan completes a training run in the men's luge singles ahead of the 2014 Winter Olympics, Feb. 4, 2014.
  • Canadian short track speed skaters and brothers Charles and Francois Hamelin watch a replay of their training on an iPad at the Iceberg Skating Palace, Feb. 4, 2014.
  • A Russian security forces K-9 officer patrols with his dog near the finish area of the Alpine ski course ahead of the 2014 Sochi Winter Olympics, Feb. 4, 2014.
  • Rosa village is seen from a gondola prior to the 2014 Winter Olympics, Feb. 4, 2014.
  • Olympic workers ski through a tunnel on the way to the Alpine ski course ahead of the 2014 Sochi Winter Olympics, Feb. 4, 2014.
  • A competitor takes a jump past a giant matryoshka doll during a Snowboard Slopestyle training session at the Rosa Khutor Extreme Park, prior to the 2014 Winter Olympics, Feb. 4, 2014.
  • U.S. snowboarder Ryan Stassel takes air off a jump during slopestyle snowboard training at the 2014 Sochi Winter Olympics, Feb. 4, 2014.
  • Speed skaters from the Netherlands train at the Adler Arena Skating Center ahead of the 2014 Winter Olympics in Sochi, Feb. 4, 2014.
  • Players from the Swedish women's national ice hockey team take part in a training session at the Shayba Arena in preparation for the 2014 Sochi Winter Olympics, Feb. 4, 2014.
  • An Olympic worker overlooks the Caucasus Mountains from the Alpine ski course ahead of the Sochi 2014 Winter Olympics, Feb. 4, 2014.

You May Like

Video Protests Continue in Ferguson, Spread to Other US Cities

Missouri officials say deployment of more than 2,000 National Guard soldiers helps curb second night of rampant arson and looting in Midwestern town More

Video Ebola, Crackdown on Illegals Hit Business in Guangzhou

Chinese city has largest community of Africans in Asia More

Video Legendary Lebanese Actress, Singer Sabah Dies at 87

Music and film diva, affectionately called 'Sabbouha' by millions of her fans, performed at Carnegie Hall in New York, Royal Albert Hall in London, Olympia in Paris, Sydney Opera House in Sydney More

This forum has been closed.
Comment Sorting
Comments
     
by: Gennady from: Russia, Volga Region
February 04, 2014 7:50 PM
The staging of the Sochi Olympics is an example of absurd extravaganza, "the feast at the time of plague", the straw that broke camel's back in impoverished outdated Putin's Russia on the brink of economic and financial collapse with national currency plunging into many years' low.


by: Bill from: Canada
February 04, 2014 7:42 PM
Perhaps it is time to award the Olympics to one site for two successive periods, so that the cost could be spread over two games. The other alternative would be to build a "permanent" site.


by: ashley macisaac from: canada
February 04, 2014 7:38 PM
They r wonderful events..however when people.have this money to spend..why is anyone.ever starving in this world?

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Aung San Suu Kyi: Myanmar Opposition to Keep Pushing for Constitutional Changei
X
November 24, 2014 10:09 PM
Myanmar opposition leader Aung San Suu Kyi says she and her supporters will continue pushing to amend a constitutional clause that bars her from running for president next year. VOA's Than Lwin Htun reports from the capital Naypyitaw in this report narrated by Colin Lovett.
Video

Video Aung San Suu Kyi: Myanmar Opposition to Keep Pushing for Constitutional Change

Myanmar opposition leader Aung San Suu Kyi says she and her supporters will continue pushing to amend a constitutional clause that bars her from running for president next year. VOA's Than Lwin Htun reports from the capital Naypyitaw in this report narrated by Colin Lovett.
Video

Video Mali Attempts to Shut Down Ebola Transmission Chain

Senegal and Nigeria were able to stop small Ebola outbreaks by closely monitoring those who had contact with the sick person and quickly isolating anyone with symptoms. Mali is now scrambling to do the same. VOA’s Anne Look reports from Mali on what the country is doing to shut down the chain of transmission.
Video

Video Ukraine Marks Anniversary of Deadly 1930s Famine

During a commemoration for millions who died of starvation in Ukraine in the early 1930s, President Petro Poroshenko lashed out at Soviet-era totalitarianism for causing the deaths and accused today’s Russian-backed rebels in the east of using similar tactics. VOA’s Daniel Shearf reports from Kyiv.
Video

Video Hong Kong Protests at a Crossroads

New public opinion polls in Hong Kong indicate declining support for pro-democracy demonstrations after weeks of street protests. VOA’s Bill Ide in Guangzhou and Pros Laput in Hong Kong spoke with protesters and observers about whether demonstrators have been too aggressive in pushing for change.
Video

Video US Immigration Relief Imminent for Mixed-Status Families

Tens of thousands of undocumented immigrants in the Washington, D.C., area may benefit from a controversial presidential order announced this week. It's not a path to citizenship, as some activists hoped. But it will allow more immigrants who arrived as children or who have citizen children, to avoid deportation and work legally. VOA's Victoria Macchi talks with one young man who benefited from an earlier presidential order, and whose parents may now benefit after years of living in fear.
Video

Video New Skateboard Defies Gravity

A futuristic dream only a couple of decades ago, the hoverboard – a skateboard that floats above the ground - has finally been made possible. While still not ready for mass production, it promises to become a cool mode of transport... at least over some surfaces. VOA’s George Putic reports.
Video

Video Falling Gas Prices Impact US Oil Extraction

With the price of oil now less than $80 a barrel, motorists throughout the United States are benefiting from gas prices below $3 a gallon. But as VOA’s Kane Farabaugh reports, the decreasing price of petroleum has a downside for the hydraulic fracturing industry in the United States.
Video

Video Tensions Build on Korean Peninsula Amid Military Drills

It has been another tense week on the Korean peninsula as Pyongyang threatened to again test nuclear weapons while the U.S. and South Korean forces held joint military exercises in a show of force. VOA’s Brian Padden reports from the Kunsan Air Base in South Korea.
Video

Video Mama Sarah Obama Honored at UN Women’s Entrepreneurship Day

President Barack Obama's step-grandmother is in the United States to raise money to build a $12 million school and hospital center in Kogelo, Kenya, the birthplace of the president's father, Barack Obama, Sr. She was honored for her decades of work to aid poor Kenyans at a Women's Entrepreneurship Day at the United Nations.
Video

Video Ebola Economic Toll Stirs W. Africa Food Security Concerns

The World Bank said Wednesday that it expects the economic impact of the Ebola outbreak on the sub-Saharan economy to cost somewhere betweenf $3 billion to $4 billion - well below a previously-outlined worst-case scenario of $32 billion. Some economists, however, paint a gloomier picture - warning that the disruption to regional markets and trading is considerable. Henry Ridgwell reports from London.
Video

Video Chaos, Abuse Defy Solution in Libya

The political and security crisis in Libya is deepening, with competing governments and, according to Amnesty International, widespread human rights violations committed with impunity. VOA’s Al Pessin reports from London.
Video

Video US Hosts Record 866,000 Foreign Students

Close to 900,000 international students are studying at American universities and colleges, more than ever before. About half of them come from Asia, mostly China. The United States hosts more foreign students than any other country in the world, and its foreign student population is steadily growing. Zlatica Hoke reports.

All About America

AppleAndroid

World Currencies

EUR
USD
0.8048
JPY
USD
118.04
GBP
USD
0.6382
CAD
USD
1.1270
INR
USD
61.892

Rates may not be current.