As I’m sure you can imagine, hosting the Olympics is no
small, or inexpensive, undertaking. Consider the fact that the Chinese
government has spent an estimated $70 billion preparing for its debut this
summer (many believe they spent nearly $300 million for the August 8th
opening ceremonies alone). The money has gone into improving everything from
city infrastructure to transportation to air quality. That’s because the
Chinese undoubtedly recognize this as a prime opportunity to convey an image of
modernity, power, and openness to foreign viewers around the world.
Yet as the end of the 2008 Olympics draws closer, there is
one question that looms in the minds of many around the world:
What will hosting the Games mean for Beijing,
or China for that matter, in the long run?
The hope is that the commitment will spur tourism,
investment, and ultimately economic growth. But the Olympics have not proven a
sure-fire benefit to a city or country’s economy. It’s a gamble.
Take, for instance, the 1976 Montreal Olympic Games. Much
like the 2008 Games, billions of dollars were spent improving the city in
preparation for the massive hoards of tourists and visitors. Yet, when the last
event was over and the Olympic flame was finally extinguished, Montreal and the Canadian government were
left with little in the way of increased tourism, and much in the way of debt.
In contrast, the 1992 Barcelona Olympic Games spurred a rebirth in the Spanish
metropolis. Money flowed in, and the debt accrued in preparing for the games
rapidly diminished. Before long, “the Barcelona
effect” (check out this article
for more insight into why Montreal and Barcelona experienced
such different outcomes) had become a model for every nation vying for the
chance to host an Olympics.
Ultimately, there is no way to know for sure exactly how the
Games will affect the Chinese economy. Whether or not the world’s largest
socialist nation will be able to sustain the investment necessary to keep
momentum strong is debatable. One thing is for sure, however; China is unlike Barcelona or Montreal
terms of history, geography, and relations to other parts of the world. The
2008 Beijing Olympics come at a time unlike any other the nation has seen
before. As one article
put it, the decision to host the Games seven years ago “was before China faced
a revolt in Tibet, a costly earthquake in Sichuan, oil prices of more than 140
dollars a barrel, the American sub-prime credit crisis, a resurgence of
inflation and the contraction of global trade.”
What this shows us is that the future is never decided by a
single moment or event. Hosting the Olympics will not alone make or break the
Chinese economy. What the aftermath looks like will depend on a number of
political, social, and economic contingencies that have yet to fully play out.
How do you think it will impact the Chinese economy in the long run? (Bonus:
let us know what, if any, geographic perspectives led you to your prediction)
Either way, I suppose we will just have to wait and see. While you’re waiting,
might I suggest putting your feet up and watching a bit of the Olympic action
P.S. Also be sure to check out the book Beijing’s
Games: What the Olympics Mean for China. It’s a great resource on the
issues discussed in this post.