2021 Olympics won’t provide much stimulus for Japan

TOKYO: IOC member John Coates, who oversees planing for next year’s Tokyo Olympics, has claimed the postponed games could help “kick start” Japan’s economy.
Japan has been devastated like many countries by the coronavirus pandemic and could be in a recession when the Olympics are to open on July 23, 2021. “These games are a very positive opportunity for an economic stimulus,” Coates said in a teleconference on Thursday with the Tokyo organising committee.
“These games can help kick start the economy again. These games could be the rebirth of the tourism industry.”
Coates also praised Japanese Prime Minister Shinzo Abe, calling him a “very, very smart man.”
He said Abe also viewed the games next year as providing an economic stimulus. But economists and Olympic researchers contacted by The Associated Press on Friday said any economic boost will be negligible given the size of Japan’s USD 5 trillion economy and the limited tourism and economic benefits from the 17-day games. In some previous Olympics, soaring prices and crowding have discouraged tourists instead of attracting them.
“His predictions fly in the face of all the research on the financial impacts of hosting the games ‘on a good day’ — and the current global crisis does not qualify as ‘a good day,’” Helen Lenskyj, a professor emerita at the University of Toronto, said in an email.
Japan is officially spending USD 12.6 billion to organise the Olympics, although a government audit report in December said it was twice that much. All but USD 5.6 billion is taxpayer money. IOC and Japanese officials say they don’t know the cost of the one-year delay, but estimates have put it at USD 2 billion to USD 6 billion. Nearly all of the added costs fall to Japan under an agreement signed in 2013 when Tokyo was awarded the games.
Coates confirmed the IOC would be spending “several hundred million dollars” because of the postponement. The funds will go to distressed international federations and national Olympic committees, and not to Tokyo.
Tokyo organising committee CEO Toshiro Muto has described the added costs as “massive” and Coates acknowledged “there will be some negative impacts.” (AP)