Influence of The Olympic Games on The City's Economy

Today, as part of the Olympic meetings of RIA Novosti, we are holding a round-table discussion on "the impact of the Olympics on the economy of the city and the region." Vladimir Klimanov, PhD, leading researcher at the Institute of Systems Analysis We can endlessly say that we are not completely prepared for such an event. This is because of all that concerns the procedures of various complexity, our typical disease in the form of corruption and simple stealing, the inability to assess the effectiveness of any measures, etc. In this respect, perhaps, I'll share a few observations on specific items. First, in preparation for the Olympic Games it turned out that we really have not established procedures to gain important, responsible, high-performance results yet. That is, the dilemma that arose at the beginning of the preparation for the Olympic Games is whether we should carry out the purchase, for example, of any goods and works to prepare for the Olympic Games or do it through public corporations; the second mechanism was chosen to maximize efforts to obtain the final result. I doubt that we could get something like that if, for example, we had chosen the path of the Law on Public Procurement, the famous Federal Law number 94, when all would be stuck in some kind of litigation and the difficulty of choosing suppliers, not getting ready facilities. This is the first consideration. The second point: I think that now counting investments that are made in the Olympic Games and, incidentally, in the Paralympic Games which, perhaps, are just as important in terms of financial investment, is meaningless. No wonder even the government, in forming the budget, including through public programs, removed from the provisional list of programs one of them specifically aimed at preparing for the Olympic Games. Still, it is very difficult now to distinguish all the set of activities which focuses on just preparing for the Olympics in terms of any settlement. I think that the necessary control is in any case carried out by regulatory authorities, there is even sometimes excessive control, but precise estimates of this should be given probably after the event. We cannot move February 2014 to a more distant period, due to various difficulties and challenges that we face. In general, we need to understand that the Olympic contract, which was signed by the city of Sochi with the IOC and the International Paralympic Committee, contains a lot of demands on the city of Sochi. There are special requirements, for example, to the behaviour of taxi drivers, to catering, to banking in the city, to cultural institutions, which should be readily available, including for people with disabilities, to pharmacists, even to whole categories of people serving some infrastructure in the city; for some reason we very often ignored this. Our emphasis is on the fact that we construct a certain required number of sports venues, some new hotels, but the city should also be dramatically transformed. This is a huge challenge for the city of Sochi, which will remain a magnet for attracting Russians in the future due to the specifics of the city, and we need to understand that the way it will now reconstruct infrastructure, rebuild small business depends on it, as well as life in the country for the next few years. Therefore, the tangle of problems that arise here is the most diverse, and we should not get hung up on the fact that the Olympic Games are a one-time event, which will take place, and we will remember for a long time. We need to think about the fact that they have a significant impact not only on Sochi, not only on the Kuban, but also on the life of the country as a whole. Nikolai Novikov, PhD, professor, advisor to the Minister of Culture We do not want all the Olympic venues to be paid off immediately after the Olympics. This is impossible in principle. I'll tell you even more: such events begin working after the event, that is, the effect occurs in the following year or in a year. It is rolled over. And if we, for example, recall the 300th anniversary of St. Petersburg, then, of course, the 300th anniversary of St. Petersburg is associated with all the problems, with the protocol, with the officials, and it was not a tourist event, but the fact that it stimulated the growth of passenger traffic, for example, from such a conservative in terms of outbound tourism country, like the U.S., by 25%. The Americans generally do not like to travel outside the U.S., but after the 300th anniversary of St. Petersburg there was an increase even there. I'm not talking about neighbouring European countries. Here we are talking about exactly the same thing. The Olympic Games in Sochi, of course, are factor of development of infrastructure in the city, but not only this. They still are a factor of attraction to the city of global attention. Here is the data of the ministry of resorts and tourism of Krasnodar region, which estimates that by the year 2017, I repeat, we are talking about a prolonged effect, because with the Olympics the effect does not end here, everything is just beginning, the number of tourists in Sochi is estimated at 13 million people in the presence of 260 000 beds. Here's infrastructure. Is this infrastructure large or small? For Russia, it is quite large. After the Olympics, Sochi will be an interesting and friendly city. Colleagues visit Sochi, and they can confirm that there are already good interchanges or delivery from the airport to the center of Sochi by modern express train. This is a modern level. And it is clear that all these problems, which Vladimir has mentioned, are great, but they can be solved. And I think that our common task is to support Sochi. German Vetrov, director of the Department of Municipal Economic Development of IUE Indeed, the estimate of the effect or impact of such events on the city is very difficult, because there's always this correlation of costs and benefits, and we see costs and benefits in the complex, comparing material and social effects. The town is rather abruptly saturated with transportation, infrastructure, utilities, etc., and this is not just a short-term solution to problems, but also a foundation for future development. Almost everywhere there are infrastructural facilities that meet the immediate problems, plus there is a reserve, which allows you to continue to do such work for the city. Economic development and the general surge in construction and investment boom naturally lead to an improvement of specific indicators. These are jobs, taxes, an increase in urban incomes. But of course, these are not only advantages. It always must be considered also in the context of subsequent effects. For example, if we're talking about jobs, information is available on average in cities which hosted the Olympics; after the Olympics only about 10% of the jobs created for the Olympics remained on a permanent basis. This is a problem, it's a challenge, because still people who come here hope to gain a foothold. This problem should be addressed, and these problems are numerous, including the use of Olympic facilities. The most classic direction using facilities is transferring into residential areas, dorms, universities, etc. Sometimes it is the dismantling of some facilities, including sports facilities. In any case, it should be very serious, designed, comprehensive, and in a number of cities that held the Olympics this has historically been a problem because, analyzing the history, remembering the practice of holding the Olympic Games in Munich, in Montreal - they are found not quite unfortunate financially, but problematic. In this sense, there is an alternative example. The most classic example is Barcelona, which after the Olympic Games demonstrated the presence of an integrated approach, changing the economic profile of the city, which from a sufficient industrial complex has become a truly developed city with a strong tourism sector where, for example, tourism for the average citizens, after the Olympics over time increased revenues to the city budget. This is a classic balanced and integrated approach.