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Official costs of the Tokyo Olympics increased 22% to $ 15.4 billion

Tokyo (AP)-Official costs for the postponed Tokyo Olympics have increased by 22%, the local organizing committee said Tuesday announced a new budget.

At an online press conference, the organizers said it would cost $ 15.4 billion to host the Olympics. This is an increase from last year’s budget of $ 12.6 billion.

The additional $ 2.8 billion is the cost of a one-year delay. Additional costs will arise from renegotiation of contracts and measures to combat the COVID-19 pandemic.

The Olympic Games will begin on July 23, 2021. The Paralympics will continue on August 24th.

However, audits by the Japanese government over the past few years have shown that the cost is higher than officially stated, at least $ 25 billion.

Tokyo said the Olympics would cost about $ 7.5 billion when the IOC awarded the game in 2013. According to a study by Oxford University earlier this year, Tokyo is the most expensive summer Olympics on record.

Japanese government agencies cover all costs, except for a privately funded operating budget of $ 6.7 billion.

“The IOC and TOCOG (Tokyo Organizing Committee) hope to keep the public budget as low as possible so as not only to prevent public criticism but also to discourage future candidate cities,” said German Institute for Japanese Studies. The director, Franz Waldenberger, said. Tokyo wrote in a recent treatise examining the cost of the Olympics.

Waldenberger said the Tokyo City and central government branches are using the Olympics as a “window of opportunity to raise additional funding.”

In October, the organizers announced a $ 280 million cost savings by cutting down on plain things, including providing hospitality. However, with 11,000 athletes and tens of thousands of executives, judges and sponsors, no reductions in sports programs have been made.

Fan decisions and pandemic precautions will be rolled out in 2021.

Japan controls COVID-19 better than most countries, with more than 2,800 deaths from the virus. However, new incidents have been on the rise for a month, raising public skepticism about the Olympics.

In a 1,200 telephone survey released this month by Japanese broadcaster NHK, 63% said the Olympics should be postponed or canceled. On the other side, 27% said the tournament should be held. The poll was conducted from December 11th to 13th.

The IOC and local organizers have stated that the Olympic Games that cannot be held this time will be cancelled.

Local organizers are trying to recoup some of the rising costs by withdrawing more income from domestic sponsors. Led by Dentsu, a marketing agent for the Tokyo Olympics, about 70 sponsors have already provided a $ 3.3 billion record.

The Nikkei newspaper reported last week that 15 top-tier domestic sponsors would add an estimated $ 150 million to their donations, citing unnamed sources “familiar with the matter.” Japan Airlines, ANA Airlines, and Tobu Sky Tower are considering donations.

Nikkei is also a sponsor of the Tokyo Olympics, along with the Yomiuri Shimbun, Mainichi Shimbun, and Asahi Azumane. Treatises from several regions are also sponsored.

“It’s challenging, but I want to increase sales more than I expected,” said Gakuji Ito, chief financial officer of the Organizing Committee.

According to Ito, insurance coverage could pay up to $ 500 million to cover the increased costs.

Mr. Ito said that all costs that the Organizing Committee cannot bear will be in Tokyo.

The budget shows that the Swiss-based International Olympic Committee has donated $ 1.3 billion to cover the cost of the game. According to Mr. Ito, his contribution to Tokyo will not increase.

Ito was asked by the IOC if he would ask for more money.

“No, we aren’t thinking about it,” he replied.

The IOC’s finances are emphasized. We generate 91% of our revenue from the sale of broadcast rights and sponsorships. The postponement of the Tokyo Olympics has stagnated the flow of earnings and makes it more important to host the Olympics in Tokyo.

The Beijing Winter Olympics will be held on February 4, 2022, six months after the closing of Tokyo.

The IOC is also under pressure to support the National Olympic Committee and the Global Association of International Sports Federations, many of which rely heavily on the contributions of the IOC.

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Official costs of the Tokyo Olympics increased 22% to $ 15.4 billion

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