SEQ should note growing realisation the Olympics is a waste of money

Forty years after the financially disastrous Montreal Olympics, cities around the world are finally realising that hosting the Olympics does not stack up. Brazilians, now experiencing a deep recession, have certainly lost much enthusiasm for the upcoming Rio Olympics (e.g. see this CNN report). So it should raise eyebrows that South-East Queensland Councils are considering a 2028 Olympics bid, as was reported last week.

Yesterday, the Financial Times published an excellent article (Rio 2016: The high price of Olympic glory, which I suspect is pay-walled, sorry) discussing the poor economic return from hosting the Olympics. It noted:

Researchers at the Saïd Business School, in Oxford, analysed 30 summer and winter games and released their findings last month. Though contested vigorously by the IOC, the study claims none of the games came in within their initial budget and nearly half exceeded targets by more than 100 per cent.

Andrew Zimbalist, an economics professor and author of Circus Maximus: The Economic Gamble Behind Hosting the Olympics and the World Cup estimates that the summer Olympics can lead to deficits of up to $15bn.

“It is sometimes argued that the deficit will be made up in the long run through increased tourism, trade and investment,” he says “The data doesn’t suggest that happens.”

An analysis of the 2000 Sydney Olympics by leading Australian economic modellers John Madden and James Giesecke found that the Games did not provide a net economic benefit to Australia. In a Conversation article (Hosting the Olympics: Cash cow or money pit?) they noted:

…rather than producing an economic benefit the Sydney Games actually reduced Australian household consumption by $2.1 billion.

As the author’s noted, this was very close to the estimated taxpayers’ contribution of $2.2 billion, as the Games provided no significant ongoing economic benefit to Australia, such as through higher tourism.

SEQ should be very wary of bidding for the Olympics.

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6 Responses to SEQ should note growing realisation the Olympics is a waste of money

  1. Glen says:

    Gene further to this is the realisation that a lot of the Infrastucture built for the Olympics has poor usage following the games period. The Sydney Olympic stadium is a perfect example, it will undergo its second major refurbishment post the olympics next year, less than 20 years since its original completion.

  2. Paul McGuire says:

    This reminds me of the Samoa Aquatic Centre. As Matthew Dornan noted in 2012:
    “In one of the least sustainable infrastructure projects in recent years in the Pacific, the Chinese Government provided funding for construction of the US$12.9 million Samoa Aquatic Centre for the Pacific Games – one of only three certified Olympic swimming complexes in the region (the other two are in Australia, New Zealand has none). The centre originally included a statue of a white elephant, although this has since been re-painted yellow. An article in the Samoa Observer two years after the Games laments the fact that no international competitions have since been held in the complex, and observes that the pool is beginning to rust.”

  3. Jim says:

    Gene

    Everything is relative, and an Olympic bid even makes the Townsville stadium look like a relatively good (less dumb) investment.

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