…estimated Loss Counted In Tens Of Billions Of Dollars
After a spike in COVID-19 infections, the Japanese authorities and the Olympics Organizing Committee decided Tokyo Olympic Games will be held without spectators at venues in and around the capital. It was a new hit for the project that was already severely over budget.
According to data presented by Safe Betting Sites, the total cost of hosting the Tokyo Olympics is expected to hit around $28bn, which is four times higher than planned. At the same time, the estimated loss due to one-year postponement and spectators ban is counted in tens of billions of dollars.
Estimated Loss Of Tokyo Olympics To Reach Over $20B
When the Japanese capital was awarded the Olympics in 2013, the bid committee projected a final bill of $7.3bn. This was revised to $12.6bn in December 2019 before the COVID-19 postponement.
A year later, when the Tokyo Organizing Committee announced the fifth version of the budget, the total expenses rose to around $14.9bn. Approximately 55% of that value, or $8.2bn, was planned for the venue-related budget of the 2020 Summer Olympics. Tournament operation cost rose to $6.6bn, while another $870 million was planned for COVID-19 countermeasures.
Later, Japan’s National Audit Board reported that the final cost would be far higher at $22bn. However, the Japanese financial newspapers Nikkei and Asahi claim that the end cost of hosting the Olympics will hit a whopping $28bn or four times more than planned.
Moreover, according to the Kansai University estimates from January 2021, the Japanese government and other entities involved in hosting the Tokyo 2020 Summer Olympic Games would lose over $5.8bn if the event was postponed, which happened already.
If the Olympic Games were kept without spectators, which is partially happening now with no spectators allowed in the host city, the total loss would surge to nearly $22bn.
Tokyo Olympics The Most Expensive, But Not With The Biggest Budget Overrun
Unfortunately, cost overruns have become the norm for the cities hosting the Olympics, and Tokyo is only the most recent example. Many other cities have also learned that hosting the games can have shocking financial consequences.
The most notable example was the Montreal 1976 Summer Olympics, where the games were 720% over budget.
Rio de Janeiro was the hosting city with the second-largest cost overrun. The 2016 Olympics held in the Brazilian city cost just under $14bn, or 352% more than planned. The 2014 Winter Olympics in Sochi follows with a 289% cost overrun, mainly due to overbudget venues.
Statistics show the 2012 London Olympics saw its final bill of nearly $15bn, or 76% over budget.