Why do countries spend millions of dollars to host the Olympic Games after every 4 years? Do the games act as a springboard to recognition? Do big events like the Olympics and World Cup contribute to the hosting country’s financial growth? Let us find out.
It was way back in the year 1956, that an article claimed that Australia had strange hopes that visitors who came to catch the Olympics Games might as well stay there for a considerable period of time or do some business as well. Though some opine that the benefits of big events such as the ones mentioned above do not extend beyond prestige for the host nation, others believe that there are obvious fiscal advantages to be derived from these events. So, what exactly is the truth?
Olympics Games: Financial Aspirations of Hosting Nations
Notably, four leading American cities like San Francisco, Los Angeles, Washington, and Boston had been vying for a successful bid to host the 2024 Summer Olympics and all these cities agreed that they were looking forward to emerging successful in their attempt to host the Summer Olympics because they believe that sporting events of this magnitude actually contribute to the economic growth of the country. The most dominant belief driving such a move is that chances of attracting global leaders are bolstered once a country serves as a host of Olympics Games. The reality, however, is starkly different. There is hardly a country that has had the record of riding high on the benefits (like tourism and global investments) derived from the Olympics Games. Needless to say, splurging on such short-term events is not really viewed as a prudent economic strategy – at least, not in the long term.
A duly palpable example has been provided here. Now, it has been pointed out that Brazil has tried to offset stadium spending (for the upcoming summer Olympics to be hosted by it in August 2016) by building bridges, highways, and other edifices to facilitate transport. However, the public would have been able to access these facilities at a much lesser cost, if transportation projects had been established and not stadiums.
Fiscal Conditions of Countries that have hosted Olympics in the past
There is no dearth of instances proving that Olympics hosts had actually gone bankrupt after the event. In 1896, Greece suffered a major financial setback post the Athens Olympics – primarily because the authorities largely underestimated the costs involved. While the estimated costs were somewhere around 585,000 drachmas, it actually escalated to 3,740,000 drachmas. Paris (France) which hosted the event in the year 1924 also had to grapple with serious fiscal issues.
Other sufferers on the list are Canada ((1976 Montreal Summer Olympics), Lake Placid (which suffered debts worth $6 million), France (1992 Albertville Winter Olympics) among others.
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