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SpirE-Journal 2007 Q3

The Beijing 2008 Olympics – China’s hope and pride

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The Beijing 2008 Olympics - China’s hope and pride

Excitement has been mounting since the countdown to the Beijing 2008 Olympics began when China won the bid seven years ago. The 2008 Games represent more than just a sporting event. The Games will provide a significant boost to business and consumer spending in China – and by implication the world. At stake may be the financial and economic prospects for the world’s fourth largest economy.

With eight months to go until the Beijing 2008 Olympics, all eyes are on China as the nation steps up its preparations for the biggest international event in its history. The auspicious date has been set – on a Friday, at 08:08:08 in the evening of the 8th day of the 8th month of the 8th year of the 21st century.

Being homonymous with the word “prosper” in Chinese, “8” is generally considered to be the luckiest number among the Chinese. Can China bet its luck on “8” for the success of the Beijing Olympics next year?

After losing to Sydney back in 2000, China went all out to outbid Paris, Toronto, Osaka and Istanbul to gain host city status for the 2008 Olympic event, based on a combination of themes – going green, advanced technology and embracing people as the centre of the Olympics.

Playing host

China has allowed the expenditures for the Beijing Games to exceed the budget allocated, even surpassing that of previous host cities’ (see Table 1).

Beijing may be spending only USD 2.6 billion to construct Olympic venues – this is only half of what Athens spent for the 2004 Games – but USD 200 billion has been set aside to give the capital a major pre-Games makeover, including permanent upgrades to the city’s transportation and communications infrastructure . Despite multiple revisions to bring down the total outlay for the Olympics, China remains on a building spree, clocking total fixed asset investments to-date at USD 36 billion, thrice its commitment budget.

Clearly, China is staking a great deal on the success of the Games, and money seems to be no object. In the context of prickly trade relations with the West, rising cross-Straits tensions and a growing domestic income gap, not to mention the shadow of the Tiananmen Square incident in 1989, a successful Olympic event will be a great boost to China’s prestige in all quarters.

While the Games bring national pride to the host country, China has also recognized and prepared forthe financial consequences. Recent host cities had difficulty recouping their total investment – inparticular, Athens and Montreal plunged into a

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