Report: London Olympic Games 2012 - 
Article published the Friday 27 July 2012 - Latest update : Friday 27 July 2012

Profit or loss? What will London make out of the 2012 Olympics?

The Olympic rings welcome fans to the London Olympics
Reuters/Neil Hall

By Paul Myers in London

“In truth, staging sports tournaments doesn’t make you rich at all,” write Stefan Szymanski and Simon Kuper write in their book Soccernomics. So what will London get out of hosting the 2012 Olympics?

London Olympic Games 2012

 “The reason countries are eager to host is an altogether different one: hosting makes you happier. Brazil will benefit from 2014 [the football World Cup], but not in money,” Szymanski, a sports economist, and Kuper, a sports writer, claim.

They point to the cash spent on organising the 2010 football World Cup in South Africa.

“When about a third of your population lives on less than two dollars a day, the government can hardly say it’s blowing billions on a month of fun," they argue. "It has to argue that the football will benefit the poor.”

Just before the Games in London, Lloyds Banking Group published a report predicting that the event will provide a 16.5-billion-pound (21-billion-euro) boost to Britain’s flagging economy, creating around 60,000 jobs.

Tourism during the games and over the first five years following the extravaganza is also expected to add 12 per cent of the GDP contribution, the analysis said.

Construction workers demolish a structure at the Olympic park in Stratford, East London
Construction workers demolish a structure at the Olympic park in Stratford, East London
Reuters/Paul Hackett

Sceptics might point out that as Lloyds Banking Group is the official banking and insurance partner of the London 2012 Olympic and Paralympic Games, any surveys emanating from their portals are predestined to be positive.

However such upbeat assessments about the future can be countered with the cold realities of now. 

Hotels in London that inflated their room rates on the basis of the predicted massive influx of tourists were dropping their prices because the very same visitors had been put off by the distorted costs.

And the Olympic naysayer’s schadenfreude is likely to be amplified by statistics showing that bookings for West End theatre shows are down as people heed the suggestions of the Olympics organisers to avoid driving into central London and to reduce any unnecessary trips into the capital.

“Big sports tournaments attract some visitors, and deter many others," Szymanski and Kuper conclude from their research.

“Greek tourism officials estimated in late 2004 that there’d be a 10 per cent fall in tourist arrivals during that year’s Athens Olympics, as holiday-goers choosing summer destinations steered clear of the frenzy. Nor did the 22 stadiums built for the Athens Games generate an economic bonanza. In 2010 an analysis by the Wall Street Journal found that 21 were unoccupied.”

With such data circulating, it is hardly surprising that the organisers’ mantra has been legacy. 

“For me it’s been really special to see the redevelopment of the Olympic Park site," British Environment Secretary Caroline Spelman said ahead of the Games. “I went to university in east London and it was a wasteland back then – the streams were full of debris. It’s difficult to imagine now. 

“What we’ve seen is the hope that the Olympics can bring. You may live in a city that has an old industrial brownfield site but the Olympics can regenerate it and regenerate the lives of the people who live near there.” 

But one politician’s transformation is another person’s destruction. 

Carlos Gonzalez is an artist from east London. His home was demolished to make way for building on the Olympic Park much in the way that Beijing’s hutongs (houses around a quadrangular courtyard) were swept away for the construction of the Bird’s Nest Stadium and Water Cube in 2008. 

Beijing Olympics 2008
Beijing Olympics 2008
Carlos Gonzalez/Courtesy of Hundred Years Gallery

“In China there were thousands of evictions with no rights for the people who were forced to leave their houses and jail sentences for the people who attempted to show this injustice to the world,” Gonzalez says. 

“We think that China is far away but here in London people have also been forced to leave their homes: this time with some rights but without the possibility of choice over their own future or the future of their community. 

“This sport event has become more of a corporate business which brings nothing much to the local people except for higher prices.” 

Gonzalez’s photographs of the neighbourhoods around Beijing and the disintegration of the east London housing co-operative where he lived are on show at the Hundred Years Gallery in Hoxton, east London.

An evening of music as well as performance and video art will be the main features of the Apocalympics on Friday night at the gallery. A two pound donation is suggested as entry to the night’s entertainment. 

A couple of miles further east, in Stratford, access to an altogether more spectacular gathering is a tad pricier: as much as 2,012 pounds for the best seats in the 80,000-capacity house to hear Sir Paul McCartney at the Olympics Opening Ceremony as well as the music of composers such as Edward Elgar. 

Oscar-winning director Danny Boyle is the creative supremo behind the event.

He’s been handed a wad of 27million pounds for one purpose alone: make the punters happy.

tags: Beijing - Brazil - China - Economy - London Olympic Games 2012 - Property - Reports - South Africa - United Kingdom - World Cup
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