When Athens hosted the Olympics back in 2004, it was hoped the event would help improve infrastructure as well as the city for a brighter future. Greece may have won gold, but unfortunately it was in their very own event – the overspending event. The crippling cost of the Olympics has been highlighted as one catalyst towards the country’s current financial ruin, so should us Brit’s be worried?
It’s estimated the cost of the Olympics currently stands around the £9bn mark; £6.2bn from Central governement, £2.1bn from Lottery funding and £900m from the London Development Agency. Although the cost is a quarter of what China spent (£45bn), it’s worth mentioning their development included an underground and airport.
There are the figures, but what do they actually mean? Well Lloyds Banking Group suggests, “the games will provide a £16.6bn boost in the economy”, that’s £7bn profit – hooray! But let’s not get carried away just yet, Howard Archer believes, “overall, we expect the impact for the UK economy from the Olympics in the third quarter will be modestly positive. Although once the games are over, the problems’ facing the UK economy is still there!”
So I’ve bored you with figures and arguments, but £7bn profit is a huge margin to predict – surely there’s profit to be made if these kinds of figures are being thrown around?
Are the Olympics great for brand Britain?
Where you’ll always get the naysayers who claim that it’s another worthless dent in our already struggling economy, my feeling is that it’s not about a direct income. The benefits are layered – we’ll get a cash return this year, maybe small, but what about the brand benefits for tourism to Britain in years to come, the UK looking like a great place for businesses to invest and buy from and let’s not forget the feel-good factor. What is that worth in times like these?
Hosting the Olympics during financial difficulties is all-good, if we’re hoping to gain some monetary advantage. So let’s just hope issues surrounding ticket allocations and security are the only hiccups we’ll experience.
What do you reckon?