By Jin Xiaoye, CIPE Global Intern
With the Winter Olympics now underway in Sochi, Russia, it is not only the events themselves that are attracting attention: the high cost of the Games and reports of poorly-constructed facilities have garnered headlines alongside the star athletes and their performances. As in other recent cases of major international events held in emerging market countries, the Games are being seen as both a test of the host country’s ability to pull of such an event, and of whether the promised economic impact will materialize.
The Summer and Winter Olympic Games, as well as the Paralympics, are held every four years in a designated host country. These are competitive events for elite world athletes and great cultural exchanges for participating countries. But sporting concerns have increasingly taken a backseat to discussions of the financial and economic impact of the games.
More and more emerging-market countries have been given the opportunity to host major international events in recent years. The 2010 World Cup, hosted by South Africa, proved to be a huge success in many respects – creating a boom in tourism and raising confidence in the country’s economy. But like other recent events, such as the 2008 Summer Olympics in China and the upcoming World Cup in Rio de Janeiro, Brazil, it also generated controversy around the cost and long-term economic impact.
The business community has embraced cooperation with the organizers of the Olympics, a trend which has especially benefitted multinationals and other large businesses. However, corruption and other negative consequences like embezzlement and human rights violations have come to one of the biggest global sports festival too.