Source: AFP
France faces a bill of almost nine billion euros to host the Paris Olympics, but top officials say the financial impact could be more “psychological” than financial.
Ahead of the start of the Games on July 26, ministers and economic observers are juggling the numbers to estimate the costs and benefits of the sporting spectacle.
So far, French authorities are projecting costs of nearly nine billion euros ($9.5 billion) for the Paris Games, although the official figure will take time to be confirmed.
Costs are always difficult to predict or confirm.
The Tokyo Olympics, delayed a year until 2021 due to Covid-19, cost about $12.9 billion, according to information from Japan’s Control Commission.
Greece’s finance ministry estimates the 2004 Athens Games cost $9.1 billion — although some independent estimates put it closer to $15 billion. London 2012 cost up to $15 billion.
![](https://images.yen.com.gh/images/2154e0a6a1945c53.jpg?impolicy=cropped-image&imwidth=256)
![](https://images.yen.com.gh/images/2154e0a6a1945c53.jpg?impolicy=cropped-image&imwidth=256)
Read also
Nike shares fall on low outlook as CEO eyes Olympic marketing win
The Paris organizing committee, bolstered by ticket sales, sponsors and funds from the International Olympic Committee (IOC), has a budget of around 4.4 billion euros and a similar amount has gone to the public company Solideo, which has built the Olympic village north of French capital.
But the final bill will depend on spending on Olympic bonuses for subway drivers, police and emergency services, as well as general security costs.
The government this week made a further €33m available to Paralympic organizers struggling with ticket sales.
The government and local authorities have so far committed around 2.4 billion euros to the Paris Olympics, mostly for construction. However, the head of the government’s Audit Court has estimated that the final state cost could reach five billion euros.
![](https://images.yen.com.gh/images/77e12c2103ec8836.jpg?impolicy=cropped-image&imwidth=256)
![](https://images.yen.com.gh/images/77e12c2103ec8836.jpg?impolicy=cropped-image&imwidth=256)
Read also
“Stress test”: Olive oil producers adapt to climate change
Bruno Cavaliere, chief economist for financial services group Oddo BHF, said “direct government involvement is relatively limited”. He added that the Olympics would not “fundamentally change” France’s public debt of about $3.2 trillion.
“Psychological” effect
According to the Center for Law and Economics of Sport (CDES), which monitors the Paris Games for the IOC and the organizers of Paris 2024, the event will generate economic benefits of between 6.7 and 11.1 billion euros for the region of Paris.
However, he added that these benefits will be spread over 20 years.
In February, consultancy firm Asteres estimated that the Games would generate €5.3 billion in additional tax and social revenue.
Deutsche Bank said in a study this month that “states hosting the Olympics or FIFA World Cups rarely earn positive economic or even social returns on what are often massive and publicly funded investment sprees in new stadiums and public infrastructures”.
![](https://images.yen.com.gh/images/e84999f422caf3ec.jpg?impolicy=cropped-image&imwidth=256)
![](https://images.yen.com.gh/images/e84999f422caf3ec.jpg?impolicy=cropped-image&imwidth=256)
Read also
Sri Lanka seals partial debt deal after financial crash
It said even the short-term boost to investment and employment was “limited” unless the host country is in recession.
For Bank of France governor Francois Villeroy de Galhau, the Paris Olympics will have more of a “psychological” impact than an economic one.
But he said that if France could improve its image around the world through the Games, then it could finally expect new investment.
“It has created jobs”
In the short term, some companies are already looking to cash out.
Le Slip Francais, an underwear manufacturer, is making thousands of extra underwear, swimwear, pajamas and other items in Olympic colors, according to its director Lea Marie.
“It has created work in our factories” for all 80 of the company’s subcontractors, he said.
Companies associated with the Olympic building spree have also benefited.
According to CDES, construction and renovation companies expect to increase revenue by up to three billion euros from the Olympics.
![](https://images.yen.com.gh/images/48e40a29e990b655.jpg?impolicy=cropped-image&imwidth=256)
![](https://images.yen.com.gh/images/48e40a29e990b655.jpg?impolicy=cropped-image&imwidth=256)
Read also
French tech major Atos rejects rescue bid
Tourism expects to earn up to 3.6 billion euros from the 15 million visitors expected for the Games, including two million from abroad.
Oddo BHF predicted that media, leisure, drinks and alcohol, consumer goods and transport companies would benefit from the Games.
Source: AFP