Beijing wants the 29th Olympiad to showcase the magnificence of a new, industrial China. And it has left no stone unturned in trying to make the Games a resounding success — in terms of public relations and economics.
Optimism abounds in China these days. Much of this optimism is attributed to China’s drive to show the world that it is the new economic superpower.
Hosting the Games could not have come at a more favorable time. But the big question is: Will there be a significant profit out of the money invested in hosting this year’s Olympics?
That this is the first time a developing country will host the Olympics brings into sharper focus the issue of return on investment.
China invested US$2 billion in sports facilities and infrastructure alone. High-speed transportation networks were also laid out. State-of-the-art train lines to transport visitors and tourists were completed last September.
Speculations vary as to the effects hosting the Olympics will have on the Chinese economy. Chinese officials are optimistic that they will realize the same profits Atlanta, Georgia raked in when it hosted the Games in 1996 — or, perhaps, even surpass it.
However, some pundits disagree. One contention is that, unlike China, Atlanta didn’t have to spend billions of dollars building Olympic venues.
Atlanta settled for renovating and sprucing up existing infrastructure. Before it won its bid to host the Olympics, China was missing anything close to a decent-sized Olympic stadium.
China also had to cough up funds to the tune of 120 billion yuan or US$16 billion between 1998 and 2006 to fulfill its commitments for a greener Olympics.
Today, the International Olympic Committee is confident of China’s ability to deliver on its promise of cleaner Beijing air. No less than the United Nations Environment Program commended China’s efforts and reported that it has fulfilled its environmental commitment to the IOC, especially in terms of implementing proactive environmental measures. (See related story.)
Although China’s greening efforts came with a hefty price tag, many experts believe that the Chinese can afford it.
Presently, China enjoys 25% economic growth and is doing better than it has in over a decade. The country continues to negotiate new investment deals and it recorded a recent surge in employment opportunities. Much of this growth can be attributed to the Games. What’s more, financial analysts give China good forecasts.
According to them, the Olympics will generate 20 billion yuan (around US$2.7 billion) in business volume for China’s catering industry. That’s a lot of money to earn from food alone.
The pre-Games flurry also created 2.1 million local jobs. And, as a side note, China will earn extra revenues from Olympic-branded souvenir items, plus ticket sales.
Experts even predict that China can expect Olympic-related economic benefits up to a year after the Games end.
However, dissenting opinions state that money, which was supposed to be poured into developing human capital and other sectors, was diverted to the Olympics — and this will negatively impact growth in the long run.
Still, there are undoubted benefits from hitting the kind of tourist volume the Olympics can give.
Welcoming the World
Beijing expects to receive an estimated 280,000 visitors to the Summer Olympics. Among them are athletes, Games officials, and media people. But the total number could exceed this figure.
The Beijing Organizing Committee for the Games (BOCOG) estimates five million foreign tourists and about 120 million domestic travelers will visit the city in 2008 alone.
China is not hosting the Games simply to promote sports. It also hopes visitors will view the country as a potential tourist destination or a hot investment prospect. Hence, catchy slogans such as the “Green Olympic,” the “High-tech Olympic,” and even the “People’s Olympic.”
The question of whether it will be a Profitable “Olympic” will probably be answered long after August 2008.
print ed: 11/07