Skip to main content

Cancelation of Olympics Would Result in Estimated $43.5 Billion Loss, 1% of Japanese GDP

After being postponed for a year, there are just six months to go until the start of the Tokyo Olympics. The coronavirus continues to spread, and with no signs of it slowing down the possibility of the worst case scenario, the Olympics' cancelation, has become more than just a possibility. Kansai University professor emeritus Katsuhiro Miyamoto, 76, has estimated that the cancelation of the Games would result in an economic loss of over 4.5 trillion yen [$43.5 billion USD]. The one-year postponement from last year has already resulted in a 640.8 billion yen loss [46.2 billion USD]. Should the Games go ahead? Another postponement? Cancel them? There is also the option being explored by the Organizing Committee of staging the Olympics without spectators. 

Government sources say that with the loss that another postponement would incur to local governments, it is not a realistic option. Tokyo has projected a direct economic effect of over 5.2 trillion yen [$49.4 billion USD[ in building and maintenance of facilities and infrastructure to put on the Games. Professor Miyamoto estimates that the loss of revenue from operating expenses, participants' consumption, domestic consumption and the like that would follow a cancelation of the Olympics would result in a loss of just under 3.5 trillion yen  [$33.4 billion USD]

Another 1 trillion yen [$10.1 billion USD] would disappear as the result of the loss of the legacy effect of post-Olympic facility usage, education and urban development, bringing the total loss from a complete cancelation to over 4.5 trillion yen [$43.5 billion USD]. This would be equivalent to about 1% of Japan's gross domestic product, roughly on the scale of the 4.2 trillion yen [$40.5 billion USD] spent at all department stores nationwide last year. "On top of the coronavirus, cancelation would be another serious hit to the economy," commented Professor Miyamoto.

If the Games do go ahead, they face a rough road forward. The event would all but definitely be downsized, with the likelihood high that events would be closed to spectators. According to preliminary calculations, halving the number of spectators and cutting back the opening and closing ceremonies would still result in a loss of almost 1.4 trillion yen [$13.4 billion USD[. Staging it without any spectators would bring the loss to over 2.4 trillion yen [$23.3 billion USD]. "The Olympics should go ahead even without spectators, but how other countries hit hard by the coronavirus would be able to deal with the situation remains unclear," said Professor Miyamoto. "If the International Olympic Committee made the decision to cancel the Games, the economic and political fallout would be extremely severe."

In preparation for the Tokyo Olympics, 42 venues in 9 prefectures have almost been completed along with investment in accommodations, road improvement and other infrastructure by local governments. "80% of the economic spillover occurs prior to the Games," commented Professor Miyamoto. A private research institute in the U.K. claimed that the 2012 London Olympics resulted in an economic spillover effect of around 2 trillion yen [$19.3 bilion USD], with 82% of the effect coming before the Games opened. 

If the Tokyo Olympics were canceled, the value of properties such as the main stadium built for the Games would be significantly reduced by not being able to apply the "Olympic" brand name to them. There is concern about additional losses to the financial burden of maintaining them under those circumstances. "The investment in preparations has already been made and they are all but completed," said Professor Miyamoto. "If the Olympics were canceled it would have a tremendous impact on consumer sentiment, and the value of the Olympic Village and other facilities would be significantly reduced."

source article: 
translated by Brett Larner

Buy Me A Coffee

Comments

Andrew Armiger said…
To state the obvious, there is much at stake. Now the trick is to balance public safety against acceptable losses. A difficult task just got a lot less fun.

Most-Read This Week

Kanazawa Marathon to Stop Runners at 21 Locations Due to Election

Due to be held the same day as voting in the upcoming election for the House of Representatives, runners at the Kanazawa Marathon can expect to be stopped at over 20 intersections on the course in order to allow voters on their way to the polls to pass without interference.  Scheduled to be held Oct. 31 after last year's race was canceled, the Kanazawa Marathon will take place while voting polls for the House of Representatives election are open. On race day, road closures for the marathon will be in place for up to 6 hours, but the locations of 14 polling stations on the course mean that voters will need to be able to cross through intersections. 50,000 voters are expected to use these locations, and while city officials are calling for people to utilize early voting or polling stations not affected by road closures then have made the decision to place security personnel at 21 intersections to stop runners when necessary. The Kanazawa Marathon already has this policy in place at

Weekend Overseas Marathon Results

With the Tokyo Marathon having canceled due to guidelines written in the pre-vaccine era some of Japan's top marathoners have had to go overseas this season. Men's national record holder Kengo Suzuki  (Fujitsu) was at Sunday's Chicago Marathon . Suzuki seemed to be staying calm in the lead group, but when the real move came he didn't have the same kind of closing speed he had at March's Lake Biwa Marathon and was left behind by the lead true. Suzuki ended up 4th in 2:08:50, the fastest time by a Japanese outside Japan so far this year. Seifu Tura Abdiwak  (Ethiopia) took 1st in 2:06:12. The next day at the Boston Marathon , Tokyo Paralympics women's gold medalist Misato Michishita  (Mitsui Sumitomo Kaijo) had a quick turnaround to win Boston's first-ever T11/T12 division race. In the elite women's race Shiho Kaneshige  (GRlab Kanto) tailed the lead pack with America Elaina Tabb through the first half of the race according to plan on sub-2:30 pace. But

February's Ome 30 km Road Race Canceled Due to Pandemic

On Oct. 14 the organizers of Tokyo's Ome 30 km Road Race announced that the popular event's 55th running, scheduled for Feb. 20, 2022, will not go ahead and will instead be postponed a year. Organizers said that due to the ongoing coronavirus pandemic they had concerns about being able to stage the event in a way safe for runners, local residents, race staff and volunteers. The Ome 30 km's 55th running was originally scheduled for February, 2021 but was postponed to 2022, meaning the new decision will in effect be a two-year postponement.  The Ome 30 km Road Race was founded in 1967. Starting in the western Tokyo suburb of Ome, the race follows a mountainous route along the upper Tama River gorge and back. Featuring both 30 km and 10 km races, the race seen wins from Olympic gold medalists like Naoko Takahashi  and Mizuki Noguchi , and is one of Japan's most popular races for amateur runners, with over 12,000 finishers every year. In place of the 2022 event, organizers