Beware the Olympic bid

BIZSPORT

EVEN AS THE sports community continues to reel about how much Athens had to spend on the 2004 Olympic Games, the International Olympic Committee is meeting to decide the venue for the 2012 Games.

The final shortlist includes London, Madrid, Moscow, New York and Paris. The final decision will be made in July 2005.

Costs involved in staging a Games of Olympian magnitude start from the bidding. For instance, Madrid is said to be spending $5.2 billion on the bid alone.

Bids require extensive travelling and lobbying "" despite the IOC ban on 'hidden' gifts and other perks offered to IOC members "" media material, high-tech presentation and building a 'green' eco-friendly image, and so on. Madrid is hoping to cash in on the legacy of the 1992 Barcelona Games.

London has former Olympic gold medallist Lord Sebastian Coe heading its bid. But news is filtering out that London's bid could be hampered in the wake of a British newspaper's report that it may have broken rules by influencing the IOC: apparently, British embassies around the world were asked to issue special invitations to IOC members for high-profile events.

Meanwhile, Paris is hoping to build on the fact that the bid has the support of the country's political, sports and business leaders, including President Jacques Chirac, as well as 92 per cent of the French public. Also, the city already has

100 per cent of its accommodation and 95 per cent of the public transport arrangements needed. Further, 50,000 existing hotel rooms in Paris have already been secured at a fixed price for 2012.

New York may not be everybody's idea of a safe city, but banners on 2,50,000 street poles say otherwise. NYC 2012 has already signed firm contracts with more than 200 hotels for nearly 45,000 rooms "" about a third of the city's entire supply "" at a formula rate that is intended to avoid scalping.

Its marketing whizkids have signed deals for 95 per cent of the city's 6,00,000 advertising signs during the Games, and about one-third of the 36,000 New York police force would be devoted to the Olympics.

Then there's Moscow, which had a successful Games despite the US boycott in 1980 and regularly has world-class sporting events. There is enough financial muscle in Russia, but the fear of terrorist attacks because of the war in Chechnya is a big dampener.

But Moscow has promised tight security (37,000 police force and 10,000 others), more than a dozen new sports facilities, more mid-range hotel rooms and improvements to the city's smog-generating traffic. Moscow's deputy mayor, Valery Shantsev, has been quoted as saying the city could raise about $10 billion to stage the event.

While each prospective host for 2012 presents the rosy side of the picture, what is often left unsaid is that sometimes things can go very wrong.

For instance, the Athens Olympics were hugely successful, but it all came at a exorbitant cost. The security alone cost near $1.5 billion, which was almost the cost of the entire Sydney Olympics.

The bill for the Athens Games at the end of the day could be over $12 billion. The latest figures offered put it at $11.4 billion and it could climb. Costs for infrastructure like new tram lines, suburban rail network, extension of the metro and so on are yet to be added.

That is an incredible overrun on the initial budget of $5.7 billion, and it could hit the Greek economy for many years to come. Worse, Greece did not get the expected economic boost as security and other concerns about overcrowding kept visitors away.

Apart from big bills, Athens has another problem: what to do with the new stadia built at a cost of more than $2.83 billion. It is estimated that it will take more than $100 million annually for maintenance of these sites.

The world has celebrated and left, but the Greeks will be paying for it for years to come. So, all cities hoping to bid for various Games "" including India, which wants to throw its hat in the ring for the 2016 Games "" should be aware of this before they step into dangerous territory.