China faces Olympic-sized sporting challenge

MANY governments still perceive that hosting major sporting contests commands significant prestige, yet that assessment may be sorely tested in February with the challenges facing the winter Olympics in Beijing.

While China is taking much pride in the fact that Beijing is about to become the first city to have hosted both the summer and winter Olympics, the event has become only the latest sporting contest to be plagued by political plus wider risks and controversies underlining the potentially massive challenges associated with such tournaments. This is not least given the huge operating costs associated with running them, including maintaining security.

For the potential success of the Beijing games, which open this Friday (Feb 4), is threatened by coronavirus outbreaks across the nation. And this comes in the week of the Lunar New Year, China's annual travel holiday, which will kick off on Tuesday when an estimated 1 billion trips will be made.

On Jan 30, Beijing reported its highest number of infections in 18 months, 5 days ahead of the start of the Games in the Chinese capital. There were 34 new infections detected alone among Olympics-related personnel, despite the nation's tough "zero virus" policy.

Of the total infections on Jan 30, 23 were among new airport arrivals, while 11 were people already in the "closed loop" bubble that separates event personnel from the public in an effort to curb the spread of infections. This loop allows Games participants to move freely between their accommodation and Olympic venues on official transport, but they are not allowed to move freely in the city. Beijing event organisers have warned of more cases in coming days as the Chinese capital enforces stringent measures, restricting movement and contact of any Games participant with the local population.

Diplomatic boycott

Beyond the pandemic, however, the winter Olympics are also facing a diplomatic boycott by multiple Western countries, including the United States, United Kingdom, and Australia over concerns about human rights in Xinjiang. This heated topic is also one which many NGOs are also focusing on, targeting brands which have endorsed or sponsored the Olympics.

It is, therefore, unsurprising that there has been a significant reduction in social media blitzes on the Games from the global sponsors, compared to last year's Summer Games in Tokyo. Former chief marketing officer for the US Olympic Committee at the Beijing 2008 Olympics, Rick Burton, has said multinationals are "walking a tightrope" and some of their social media accounts have barely mentioned Beijing 2022.

What is possible therefore is that there are "2" Winter Olympics. One inside China, where some brands heavily promote Beijing 2022, and an Olympics in the West, where other firms barely mention the Games. If this proves accurate, the next 2 weeks may offer a potential insight into the future for multinationals trying to keep 2 sets of competing political powers content, with very different value systems.

While the challenges facing the Beijing Games may be the biggest of any sporting event of modern times, they are by no means unique. Last summer's Olympics, postponed for a full year from the original date in 2020, for instance saw a state of emergency in Tokyo and 9 other regions for weeks beforehand to try to control the pandemic. Meanwhile, overseas fans were barred from attending.

Yet, the coronavirus crisis is only the latest example of health, economic, political and wider risks and controversies afflicting such tournaments. The Brazil 2016 summer Olympics offers another stark example of the pitfalls of hosting major sporting events. When Rio won in 2009 the right to host the Games, the national economy was booming and the country was enjoying significantly enhanced international prestige as a leading emerging market within the so-called BRICS group of nations.

In 2016, however, Brazil was mired in a political crisis surrounding the impeachment of then-president Dilma Roussef, and the-then worst recession in decades which forced significant spending cuts to the Olympic budget. Further, more than 100 prominent doctors and professors wrote an open letter to the World Health Organisation asking for the Games to be postponed or moved from Brazil "in the name of public health" in light of the-then widening Zika outbreak which, prior to the coronavirus pandemic, was the worst health crisis facing Brazil since at least 1918, impacting many thousands of people.

Source of national pride

The problems afflicting the 2016 Games underline the massive challenge and expense of hosting such mega tournaments. For instance, Brazil spent at least US$10 billion on the event, and probably much more in practice, reported to be in excess of any revenue it could generate, especially as many tourists were put off from travelling to the country because of the Zika virus.

So despite the fact that hosting major sporting events continues to be seen as a source of national pride, growing evidence indicates that they do not generally provide a substantial economic boost to national economies from stimulus like capital investment and tourism. For instance, many of the visitors tend to come from the host country whose spending often simply displaces that on other domestic leisure services. Moreover, the legacy value can be limited too with many facilities built at high cost simply becoming "white elephant" projects falling into disuse.

Despite all these pitfalls, however, it is noticeable that there remains no shortage of cities wanting to host the 2036 summer Olympics, following-up on Paris in 2024, Los Angeles in 2028, and Brisbane in 2032. Meanwhile, numerous cities have already expressed firm intent to host the 2030 Winter Olympics, building from Milan and Cortina d'Ampezzo in 2026. Moreover, there is also a long list of states which have also expressed interest in bidding for the other massive events like the 2030 soccer World Cup which comes after the events scheduled in Qatar in 2022, and Mexico, Canada and the United States in 2026.

For the foreseeable future at least, what this collectively underlines is that the perception that hosting such sporting events is a major symbol of national prestige will continue to supercede the headaches that can come with staging them. However, that tide may yet turn in the opposite direction, and the next fortnight in Beijing could potentially be key to that calculus.

• Andrew Hammond is an associate at LSE IDEAS at the London School of Economics.