BARCELONA, (PNA/Xinhua) — The state will be the main beneficiary of any country chosen to host the Olympic Games thanks to increased revenue from taxes
That is the opinion of Ferran Brunet, (Barcelona 1953), a profesor in the Department of Economics and Busniess Studies and the Universiad Autonomica d Barcelona (UAB), where the Centro de Estudios Olimpicos (Center of Olympic Studies), which is dedicated to the investigation of the Olympic movement and sport, was founded
Professor Brunet has a long experience of investigating the economic impact of the Games on their respective host cities, among them, Barcelona 1992 and Beijing 2008.
Saturday sees the International Olympic Committee name the host city for the 2020 Olympic Games with Spanish capital city, Madrid competing against Tokyo and Istanbul.
With Spain deep in an economic crisis the election of Madrid is expected to provide a massive boost for the economy, with the creation of around 80,000 new jobs. However, the unemployed would not be the only beneficiaries.
“Almost 40 percent of all economic activity stimulated by the Games comes in the form of taxes and they go to the State,” Brunet explained to Xinhua, adding that for Madrid 2020, “the fiscal balance could be positive as quickly as 2020.”
That does not necessarily mean the Games will be profitable for a country. “It depends on the weather, the city and how the Games develop….but they all have the capacity to be profitable and nearly always are.”
However, there are risks that must be faced, as in the case of Barcelona
“Barcelona was the ‘Titanic in the year 1986,” said Brunet. The city have serious social and economic problems and the Olympic Games were the “excuse” to begin an urban reform project which changed the face of the city and opened it to tourism on a massive scale, with tourist numbers climbing from around 700,000 a year before the Olympics to around 7 million now, as Barcelona has become a top tourist destination.
One area to benefit was the Poblenou neighborhood, which prior to the Games was a post-industrial area in a state of semi abandonment, despite its position next to the sea.
The decision to situate the Olympic Village in Poblenou gave the area a facelift and it now at the heart of the telecommunications and technological industries in Barcelona.
“The area grew and improved and became integrated into the city,” explained the President of the Poblenou residents association, Salvador Claros to Xinhua, who commented that the downside has been a disproportionate rise in housing prices which have forced many former residents to move out of the area..
The Olympic Village for Madrid 2020 has still to be built and the crisis means it will be built within the demands of austerity, which Brunet sees as a good thing, explaining that Barcelona 1992 took place in the midst of a crisis, “but it got done.”
A project such as Madrid’s is based on a large part of the infrastructure already being in place and Brunet believes that improvements to infrastructure are not the main benefit of hosting the Olympics, the positive thing is the improvement of regulations.
“If you do that, then you are improving your competitiveness. Madrid has an extraordinary opportunity to situate itself as an international business center,” he said, highlighting that in 1990 Barcelona had been considered the 11th best European city for business and it is now the fourth.
Finally he said that the number of people out of work in Barcelona fell by just over 50 percent between November 1986 and the start of the Olympics in July 1992, dropping from 127,774 to 60,885.
Although Brunet was reluctant to give figures for a hypothetical Madrid Games, he did say that around 30,000 jobs could be created in other cities in Spain if the capital was chosen to host the Olympics.