Hosting the Tokyo Olympics has accumulated losses running into billions for Japan. The nation is projected to generate revenue of only $6.7 billion, whereas the budget for the Tokyo Olympics has exceeded $20 billion.
It was earlier forecasted that the postponement of the Olympics due to the pandemic had alone cost a whopping $3 billion in losses. Organisers in December 2020 put the losses at $2.8 billion.
The loss on ticket sale is costing the organisers $800 million.
But this is nothing when compared to the income that would have been earned if people were present as they would have spent huge amounts of money on food, travel, merchandise and hotels.
For these segments the projected loss of income is said to be over $2 billion.
HOST COUNTRY LOSSES
This isn’t the first time that host nations have incurred losses. This trend seems to be carrying on regularly.
In 2008 when the Olympics was hosted by Beijing, China spent at least $40 billion, but the revenue incurred was a little over $3.6 billion. In 2012, London had burnt over $18 billion in hosting the Olympics but made a recovery of roughly $5.2 billion.
Rio De Janeiro hosted the 2016 Olympic games, this resulted in them burdened with financial debts.
Recurring losses has set the sports industry back quite a bit as the International Olympics Committee (IOC) is a non profit organization.
All the revenue that is earned is usually handed over to nations across the world to build athletes and sports as a whole. Large amounts of these funds are also utilized to build and enhance the anti-doping ecosystem.