Amid a severe economic crisis plaguing the site country of Brazil, Rio 2016 Olympic Game organizers met in a series of “crises meetings” over the past few days to identify cost-cutting measures in an effort to reduce the massive event’s overall budget. The Brazilian economy is expected to shrink by 2.1% this year, while maintaining an inflation rate of 9%; data which has already caused Rio organizers to reduce its Opening Ceremonies budget to be just 10% of the amount spent on the same celebration at the 2012 London Olympics.
To avoid a repeat of the public outrage the country of Brazil experienced last year over exorbitant costs surrounding hosting the FIFA World Cup, Rio 2016 will be attempting to further reduce its estimated £2.38 billion ($3.6 billion/€3.2 billion) budget by as much as 30%. The most heavily impacted areas are infrastructure and volunteers, whereby the volunteer force will be reduced from 70,000 to 60,000. Test event infrastructure will be scaled back, along with the production of all promo videos being sourced in-house.
Of the cost-saving measures, Rio 2016’s Director of Communications, Mario Andrada, said, “The days of lavish spending are over. People get upset about luxury and excess and we have to tighten our belts.”
In some potential good news coming from the Rio 2016 organization, the outfit has plans to help Brazilian small businesses benefit from the Olympic and Paralympic Games by setting a goal of signing about 10% of its contracts with small businesses and micro-enterprises. The estimated dollar amount of such contracts falls in the ballpark of R$300 million (US$77 million) worth of business.
They could cut costs by putting the triathalon on day prior to the start & routing it through the favelas – thus saving on finish line expenses & freeing 100 beds at least that could be re allocated just in time for those arriving for The Opening Ceremony day.
There is a saying among USAmerican ex-pats and tourists in Brazil that “Rio is not for beginners”, due to some of the intractable political and socioeconomic issues there that effect quality, and sometimes safety, for residents and tourists alike. I totally loved Rio but was glad that I got the warning beforehand as it came in very handy, as it turned out. While Brazil is not universally considered to be a 3rd world country, as a newly industrialized society, it was a risk. I have to agree that it was a poor choice for 2016, as its reach exceeded its grasp. But that said, everyone will just have to hope for the best and make the best of it; since… Read more »
-2.1% of GDP in Brazil this year? Wow. I’m learning something. I knew they had a big problem of inflation but I didn’t know they were in recession like that. I’m not an economist but I like politics and the economy overall. Not a long moment ago, “specialists” talked about a Brazilian miracle!
Most of European Union in recession or close to recession in the last 5 years because of stupid austerity economic policies with as result an unemployment rate still over 10% today. Now some emerging countries in turmoil. In comparison and despite the fiasco of the decisions, or rather the non-decisions of the R Congress, USA looks like an ocean of prosperity with a steady growing economy… Read more »
The reason emerging countries are having trouble is due to the fact that they are spending to get themselves out the recession. When you tax and spend you eventually run out of other people’s money. Greece also had a culture where not paying tax is ok. Even now with taxes extremely high businesses are not filling the proper tax and operating on a cash only basis to avoid taxes.
The Olympics are cited as a driving factor as to why Greece is in trouble. London is working to turn the trend around but we may not know for another 20+ years if the different facilities earned their costs back.
I wouldn’t trust the job numbers in the United States. in… Read more »