How else can Japan, which has been emptied by the Olympics, saved?

Original title: How can Japan be saved by the Olympic Games

The Paper, trainee reporter Hu Jie and intern Ma Yiyan

Using cardboard as a bed, using e-waste as a medal, using recycled plastic as a podium, even the 100 billion yen Tokyo New National Stadium does not even have air conditioning, only 185 fans… These extreme operations are in the Tokyo Olympics. The organizing committee seems to be practicing the concept of low-carbon and environmental protection. In the eyes of outsiders, the Tokyo Olympics, which can be called “crowdfunding”, is nicknamed environmental protection, but it seems a bit “stingy”. But in fact, this is also because the Tokyo Olympic Organizing Committee is weighing a lot of economic burden.

When Tokyo won the Olympic Games in 2013, the Tokyo Olympics was regarded by the Japanese government as a “trigger” to revitalize the economy; but now that the epidemic has not passed, the Tokyo Olympic Organizing Committee is still holding the Olympic Games with its teeth. Hope to lose a little less money.

Today’s Tokyo Olympics has become an out-and-out “golden beast.”

　　Severe overspending, hollowing out Japan’s “family assets”

If the hour hand is set back to 2013, Tokyo, which has won the right to host the 2020 Olympic Games, must be filled with excitement. At that time, the Abe government regarded hosting the Olympics as a weapon to revitalize the economy, hoping to inject vitality into Japan and help Japan get rid of the 15-year-old deflation and economic downturn. As the host country, the Olympic Games is an excellent economic opportunity for the host country. In the past, from the initial investment to stimulate domestic demand, to the prosperity of the tourism and service industry in the middle of the Olympics, to the comprehensive development of infrastructure and import and export demand in the post-Olympic period…The economic stimulus of the Olympic economy to the host country is obvious. According to a report cited by Kyodo News in 2013, benefiting from the growth of infrastructure construction and tourism, the 2020 Tokyo Olympics is expected to boost Japan’s economic growth by 0.5%. The Tokyo Metropolitan Government also estimates that the nearly 7-year Olympic preparation process will bring Japan at least 150,000 jobs and 2.96 trillion yen (about 187.6 billion yuan) worth of economic benefits.

After successfully hosting the Olympic Games in 2020, Japan will “completely get rid of the predicament of economic austerity, and the overall economy will take on a brand new look.” Among them, industries such as construction, services, finance and insurance and tourism will benefit the most.

At the same time, some related surveys also show that Japanese people generally hope that the 2020 Tokyo Olympics can stimulate economic growth like the 1964 Olympics.

The ideal is full, but the reality is very skinny. Even the budget overrun makes Japan complain. When bidding for the Olympic Games in 2013, Japan officially estimated that the cost of hosting the Olympics was 7.3 billion U.S. dollars. As of September 2020, according to Oxford University research and calculations, Japan’s actual investment reached nearly 15.84 billion U.S. dollars, with a cost overrun of 200%, setting a record for the Summer Olympics. As early as 2018, the Japanese Government Accounting Inspectorate published a 178-page report showing that Japan may spend 25 billion U.S. dollars to prepare for the Olympics, and the final expenditure may be even higher. In fact, the Japanese people have long been aware of the situation that the Olympic Games exceed the budget. But if there is no epidemic, such an effort may be able to fill the gaps in the ticketing, tourism, sponsorship, financial and insurance industries.

It’s just that when these channels all press the “pause button” due to the epidemic, it will only make Japan empties its “family” if it fails to make ends meet.

Among such losses, the most intuitive statistical data is ticket revenue. On July 11, Toshiro Muto, CEO of the Tokyo Olympic Organizing Committee, said that the Olympic Games in five regions including Tokyo will be held empty. As a result, 97% of the 750 games in the Tokyo Olympics will be held empty. Compared with the original plan, only 3% of ordinary spectators who have purchased tickets will be able to watch the game. Before the announcement of the empty venue, the Tokyo Olympics had sold 3.63 million tickets. Among them, the number of overseas tickets is about 900,000 (600,000 tickets for the Olympic Games and 300,000 tickets for the Paralympics), and overseas audiences account for about a quarter of the total audience. The empty venue means that the money received by the Tokyo Olympic Organizing Committee will be returned in full. How much is it? Toshiro Muto said that revenue will fall from the estimated 90 billion yen (approximately 5.3 billion yuan) to billions of yen. He admitted at the press conference that the revenue and expenditure situation of the Tokyo Olympic Organizing Committee “will undoubtedly be out of balance.” Behind this is a serious blow to the Japanese tourism service industry. Economists pointed out that the tourism and consumption losses caused by the Olympics not accepting overseas audiences are expected to reach about 150 billion yen.

It is certain that the Tokyo Olympic Organizing Committee will have a deficit in revenue and expenditure, and it is inevitable to use Japanese taxpayers’ money to pay for the bill. According to Japanese media reports, after the conclusion of the Tokyo Olympics and Paralympics, the Tokyo Olympic Organizing Committee will negotiate with the Tokyo Metropolitan Government and the central government on the financial burden.

　　Not held?Worse off

Anyone with a discerning eye can see that the longer the Tokyo Olympics, the more investment they will invest in, but why should they continue? This state of “the arrow has to be sent on the string” is actually because if the Olympic Games are not held, the losses may be even worse. According to relevant data from previous Olympics, ticket revenue is not the main source of income for the Olympic Organizing Committee. Commercialized television broadcasting rights and Olympic sponsorship programs are the more important part. It just so happens that the Tokyo Olympics is the explosion of broadcasting technology. The International Olympic Committee estimates that the TV coverage of the 2020 Tokyo Olympics is expected to be about twice that of the 2016 Rio Olympics. In the United States and Europe, the broadcast time on TV and digital platforms is estimated to reach record-breaking 7000 hours and 4000 hours-although it is an empty game, the coverage of Olympic media broadcasters will be higher than in the past. According to data from the International Olympic Committee, if the Tokyo Olympics were not held, they would have to refund $4 billion in television broadcasting rights income, which accounted for 73% of the total income. At the same time, sponsors have also become the “life-renewing” medicine for the Tokyo Olympic Organizing Committee. According to public data released by the International Olympic Committee in 2020, sponsors of the Tokyo Olympics are divided into four levels, of which 14 are top partners, who directly sign sponsorship contracts with the International Olympic Committee. The other three levels are the 68 domestic sponsors signed by the Tokyo Olympic Organizing Committee, including 15 gold partners, 32 official partners and 19 official supporters. Before the postponement of the Olympics, the contract value signed by the Tokyo Olympic Organizing Committee and its sponsors exceeded US$3.3 billion, which is three times as much as the 2008 Beijing Olympic Games held in Asia. This sponsorship amount not only set a record high in Olympic history, but also exceeded the sum of the sponsorship amounts of the last two World Cups. After the Olympics were postponed, 68 domestic sponsors “Buzzer” reached a contract extension agreement, for which the Tokyo Olympics received a 22 billion yen (approximately 1.29 billion yuan) sponsorship fee. At that time, Yoshiro Mori, then chairman of the Tokyo Olympic Organizing Committee, was very excited, “As the new year enters, we will continue to actively prepare with the support and help of all relevant personnel to create an Olympic Games suitable for the world after the epidemic. And the Paralympic Games.”

It is conceivable that if the Olympics are suspended, the compensation and refund of the broadcasting copyright and sponsorship fees alone will be enough for the Olympic Organizing Committee to drink.

　　The Olympic economy affects the whole body

In addition, the Olympic economy is no longer the business of the host Tokyo alone, but a systemic project that involves the whole body. Let’s take NBC Universal, which has the rights to broadcast the Olympics in the United States, as an example. In March 2020, NBC Universal announced that it had sold US$1.25 billion worth of domestic advertising through the Tokyo Olympics, surpassing the sales of the 2016 Rio Olympics. NBCUniversal CEO Jeff Schell said at an investor conference that, boosted by ratings, the Tokyo Olympics “may be the most profitable Olympic Games in its company’s history.” For individual associations , The dividends of the Olympics are even more “the guy who is looking to eat”.

According to data from the International Olympic Organizing Committee, the headquarters will allocate US$549 million to the Olympic Committees of various countries for the Olympic Solidarity Program and other expenditures. Part of this fund is used to fund the Olympic scholarship program, providing monthly training subsidies and travel subsidies for athletes in need to participate in the Olympic qualification competition. It is not only developing countries and regions that need this fee, but many developed countries are also counting on it. The British Olympic Association proposed in its annual report that if the Summer Olympics are cancelled this year, it may lead to a financial crisis for the association. One of the directors said: “If the Olympics are cancelled, there will be substantial uncertainty, which may make people seriously doubt whether the association can continue to operate.”

Therefore, when the Olympics became a systemic project that “kicked and moved the whole body”, the Tokyo Olympic Organizing Committee had to bite the bullet and continue to do it.

Editor in charge: Zhu Xuesen SN240