The state of affairs sure does stink (figuratively and literally) in Sochi, eh? Journalists have been documenting everything from stray dogs to brown drinking water in the city hosting the Winter Olympics, even after Russia poured some $51 billion into getting ready to host the games, making it the most expensive in history. Come on Russia, get it together, right?
Well, keep in mind the scourge the Olympics brings upon the host cities themselves—such that it's a wonder any place would actually want them.
Many nations vie to host the games for the perceived economic and geopolitical benefits. Nothing like the world sending you its best athletes in traditional garb to make you look like you're super-important (way to show commitment to those shorts, Bermuda). And then think of all that money coming from tourists and investors!
But economic studies show a mixed bag. Some places, such as Barcelona, may have ended up with a long-term benefit. But look other sites, such as Athens; the Greeks shelled out $15 billion, contributing to the nation's crippling debt, and ended up with bunch of abandoned sports complexes to show for it. The Beijing games cost $40 billion, and tourism bookings actually went down during the summer of 2008. The air pollution levels that Chinese officials had committed to lowering during the games rebounded when the events ended.
Russian officials insist they will be better off in the long run. But others in the nation argue that the resources could have been better spent. "If all that astronomical amount of money—astronomical even for Russia—had been invested in the improvement of utilities and services, it would have given a strong push to economic development," Vadim Bit-Avragim, who helps manage about $4.3 billion at Kapital Asset Management in Moscow, told Bloomberg.
Russian President Vladimir Putin is banking on Sochi becoming a resort and destination city in the aftermath of the Olympics. But ratings firm Moody's predicts that uncertainty about the long-term benefits for Sochi overshadow any potential gains, which, by the way, will have to come from the hotel sector since that's where most of the private investment went.
"It depends on the Russian government's efforts to attract new tourists to Sochi, which we estimate need to increase by 2.5 or three times after the Olympics to ensure that the majority of the hotels are full," a Moody's analyst told Reuters.
Given that most of the press that Sochi's hotels have received has focused on doorknobs falling off and blame for Bob Costas's eye infection, it's tough to foresee tourists, Russian and otherwise, flocking to their offerings.
Asking for the world's spotlight can be a great marketing campaign. Other host cities were already international destinations. Not so for Sochi, or for Russia as a whole. Tourism accounts for only 1.5 percent of the nation's economy, and Russians tend to go abroad for vacation.
But that spotlight can shine brightest on the ugliest spots, which is how things are playing out in Sochi. And, probably, for most future Olympic destinations.
So while we all mock Sochi's inability to be an adequate host, remember that when the journalists and athletes depart, they're leaving behind a city that may very well be worse off for the entire experience.
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