2008 olympics & china

BEIJING OLYMPICS

The Olympics and China's Socio-Economic Development

Why Bid for the Olympics

Opportunity for emerging power to promote their country as developed and prosperous

Either applying for hosting of the Games, or the actual hosting will help promote the city's “open-up commitments”, economic development and social progress New international markets, and increased internal

and external consumption in expanding global marketplace


BEFORE New infrastructure Industry development

DURING Revenue Tourism


AFTER Economic regeneration Tourist interest

Political & Social Impacts: Nation-building, legitimization of govt position, pride

& marketing for the country, foreign policy objectives

Effect of Games w/ Past Hosts

Based on past history, the host country experiences a decline in GDP growth a year after the games

By the time the Beijing Olympics commences, the cities of Montreal (1976), Barcelona (1992), Sydney (2000), and Athens (2004) will still be paying off debt incurred from hosting the previous Games

Bidding for the Olympics

To become a host city, the bidding city must submit its proposal to the IOC or the International Olympic Committee

Factors considered range from ability to engage in massive infrstructure projects to macropolitical questions about the messages that the selection of the city creates

Selection of host cities has served 2 functions: graduation and rehabilitation

China's Bid for the Olympics

Olympism has unrealized potential in the Orient world

When China competed in the 1984 LA Games in 1984, the PRC called a press conference and announced its intent to host the Games in 2000

In 1993, China lost its hosting bid to Sydney by 2 votes

China's Bid for the Olympics

In response to failed bid, China accelerated its economic growth, expanding at a faster growth rate than any other East Asian nation

In 2001, China again submitted its bid The 2008 Beijing Olympics will facilitate

implementation of the 10th “Five-year Plan” and the “Strategy of Three-phased Development” for Beijing

8 Broad Areas Affected

Transport & traffic

- subway capacity airport terminal

Technology & information

Cultural & sports industry

Environmental improvements

Tourism $5.6 billion Wholesale & Retailing

$1.8 b Real property Architectural industry

$500b = 80,000 jobs

- 19 venues

Beijing Olympic Action Plan

3 CONCEPTS

1) Green Olympics Prioritized environmental protection in planning,

designing & construction of Olympic venues and facilities

Includes strict ecological environment standards and systematic supporting systems in the environmental treatment, afforestation and beautification of both urban and rural areas


3 CONCEPTS

2) High-tech Olympics Adopting the latest available high-tech innovations

during the Games

3) People's Olympics Popularize Olympic spirit, promote traditional

Chinese culture, as well as friendliness and hospitality of its citizens

Bridge for cultural exchanges to deepen understanding and enhance trust and friendship among different nationalities


“Promoting the modernization of Beijing as well as the rest of the country – we aim at maximizing the positive impacts of the Olympic Games on national economic development and accelerating the modernization drive of the country. We will strive for a breakthrough in the capital in terms of economic development, urban construction, social progress and people's living standard, so that, by 2008, the per capita GDP of Beijing will exceed $6,000 and the economic, urban and social development will be drastically accelerated.”

Phase 1: Pre-preparation

December 2001 – June 2003 Develop Beijing Olympic Action Establish structure of BOCOG Complete all necessary preparations for

construction of the Olympic venues and facilities

Initiate construction of EP facilities and urban infrastructure, cultural & tourist sites

Phase 2: Development

July 2003 – June 2006 Complete tasks in 10th Five-year Plan Construction of Olympic venues andother

related facilities and preparation in other areas wil be in full swing

By June 2006, major construction projects of Olympic venues and facilities will be completed and basic preparations finished

Phase 3: Improvement & Operation

July 2006 – 2008 Games All venues and facilities will be in place Venues will be examined and improved Test events will be conducted to ensure smooth

operation All services will be available

Cost of the Games

The tally of $42 billion, or about 290 billion yuan, was calculated by the government-run Beijing Olympic Research Center.

Olympic facilities and operational costs account for 31.8 billion yuan of that total, with another 71.3 billion yuan on efforts to clean up the environment. The majority -- about 180 billion yuan -- has been spent on infrastructure development, including roads and highways

Cost of the Games

The tab for China's massive Olympic projects -- ranging from a $3 billion airport terminal to the $500 million "Bird's Nest" National Stadium -- dwarfs the Athens Olympics budget of $15 billion, which helped drive Greece into debt. London, host for 2012, is already embroiled in controversy over its Olympics tab.

Direct & Immediate Effects

New facilities are massive & designed to impress with price tag over $3 billion

Beijing's older architectural treasures have undergone extensive restoration

Major infrastructure projects – subway lines, roads, rail link to airport and the new world's largest terminal and environmental improvement projects – cost of $42 billion

Longer Term Benefits

Developing new and high technology industries including electronics & information, bioengineering & new medicine, optical, mechanical & electrical integration, new materials, and environmental protection and multi-purpose utilization of resources

Up to 2008, added value of high and new technology industry will account for 40% of city's industrial output value

Longer Term Benefits

Developing tertiary industry constitutes mainstay of Beijing economy and will play direct and important role with regard to the services for the Games Include information and consultant services, agent

services, tourism, convention & exhibition industry, science & technology education, culture & sports

Also include financing, commodity circulation, real estate services, transportation, post & telecom

Up to 2008, added value will be 65% of city's GDP

Beijing Economy

From 2001 to 2006, economy grew at annual rate of 12.2% 1.4 percentage points higher than economic growth rate between 1997 and 2001

Per capita GDP climbed from USD3,000 to USD6,331. The World Bank classifies Beijing's socio-economic development as upper-middle level in the world

Beijing Economy

In 2006, average annual wage for Beijing city workers was Y40,117, which was Y20,962 more than in 2001, increasing by 109.4%. If inflation factor is included, annual wage increase is 15.7% in real terms

Accdg. to standards released by Food & Agriculture Orgn of UN, Beijing residents' living standards have moved from “well-off” standard to the “relatively prosperous” stage.

Post-Olympics

Post-Olympic economic downturn, also called “valley effect” or “V-low effect” Caused primarily by huge investment during pre-

Olympics where consumption and revenues increase up to actual Olympics

Beijing Post-Olympics

Economic downturn unlikely since gov't has already taken series of micro-economic measures to cool down economy

Although investment to build sports venues and other infrastructure totaled billions of dollars, this actually accounts for only 3% of the country's total investment in fixed assets

Fan Gang – Director of National Economic Research Institute at China Reform Foundation and Monetary Policy Committee member of People's Bank of China

OGI – Olympic Games Impact

Collaboration between local organizing committee, a university in the host city & IOC

Collect information on 150 economic, social and environmental indicators

Starts when candidacy of city is announced until 2 years after Olympics close (total of 11 years)

Thank you

2008 olympics & china

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