[ad_1]
TOKYO – The official cost of the postponed Tokyo Olympics has risen by 22 percent, the local organizing committee said in unveiling its new budget on Tuesday.
In an online press conference, organizers said the Olympics will cost $ 15.4 billion to host. This is up from the $ 12.6 billion in last year’s budget.
The additional $ 2.8 billion is the cost of the one-year delay. The expenses come from the renegotiation of contracts and measures to combat the Covid-19 pandemic.
The Olympics will open on July 23. The Paralympic Games follow on August 24.
However, audits conducted by the Japanese government in recent years show that the costs are higher than officially declared and are at least $ 25 billion.
Tokyo said the Olympics would cost about $ 7.5 billion when the IOC awarded the games in 2013. A study from Oxford University this year said Tokyo is the most expensive summer Olympics on record.
“The Tokyo Olympics are operating in a very difficult environment,” said Toshiro Muto, executive director of the organizing committee, when asked about record costs. Muto suggested that games should be viewed as an investment rather than a cost.
Japanese government entities are responsible for all costs except for $ 6.7 billion in a privately funded operating budget.
“The IOC [International Olympic Committee] and TOCOG [Tokyo Organizing Committee] we want the public budget to appear as small as possible not only to guard against public criticism, but also not to discourage future candidate cities, ”wrote Franz Waldenberger, director of the German Institute for Japanese Studies in Tokyo, in a recent article that examine Olympic costs. .
Waldenberger noted that the Tokyo city government and the central government branches use the Olympics as “a window of opportunity for additional funding.”
In October, organizers announced cost cuts of $ 280 million, eliminating luxuries that include hospitality offers. However, no cuts have been made to the athletic program with a full complement of 11,000 athletes and tens of thousands of officials, judges and sponsors expected to attend.
Muto acknowledged that the cost had increased for the opening and closing ceremonies of the Olympic and Paralympic Games. Organizers were expected to report a figure later in the week. The Japanese Kyodo news agency, citing sources close to the committee, reported that the increase is approximately $ 33 million.
Decisions on fans and preventive measures for the pandemic are expected to be implemented in the spring. The reduction in the number of fans will affect ticket sales, an important source of income.
Japan has controlled Covid-19 better than most countries with 3,000 deaths attributed to the virus. That milestone was reached on Tuesday. New cases have been on the rise for a month, adding to public skepticism about the Olympics.
In a telephone survey of 1,200 people published this month by Japanese broadcaster NHK, 63 percent said the Olympics should be postponed again or canceled, and 27% said the games should be held. The survey was conducted from December 11-13.
The IOC and local organizers have said the Olympics will be canceled if they cannot be held this time.
Local organizers are trying to recoup some of the rising costs by drawing more revenue from national sponsors. About 70 backers have already contributed a record $ 3.3 billion, powered by Dentsu Inc., the marketing agent for the Tokyo Olympics.
The Nikkei newspaper reported last week, citing anonymous sources “familiar with the matter,” that 15 top-tier national sponsors will add an estimated $ 150 million to their contributions. He said Japan Airlines, ANA airline and Tobu Skytower were considering contributions.
Nikkei is also a sponsor of the Tokyo Olympics along with other major Japanese newspapers, Yomiuri, Mainichi and Asahi. Several regional documents are also sponsoring.
“We would like to increase revenue more than expected, although it is a challenge,” said Gakuji Ito, financial director of the organizing committee.
Ito said the insurance coverage could pay up to $ 500 million to help cover the increased costs.
All expenses that the organizing committee cannot cover will fall to the Tokyo Metropolitan Government, Ito said.
The budget shows that the International Olympic Committee is contributing $ 1.3 billion to cover the costs of the games. His contribution to Tokyo will not increase, Ito said.
Ito was asked if he would seek more money from the IOC.
“No, we are not thinking about that,” he replied.
The finances of the IOC are stressed. It generates 91 percent of its revenue from the sale of broadcast rights and sponsorships. The postponement of the Tokyo Olympics has stalled their revenue stream, increasing the importance of hosting the Olympics in Tokyo.
The Beijing Winter Olympics opens six months after Tokyo closes in February 2022.
The IOC is also under pressure to support national Olympic committees and international sports federations, many of which rely heavily on contributions from the IOC.
