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Economy

Japan expects $283bn boost from 2020 Tokyo Olympics

Estimate for 2013-2030 sees economic benefits and 1.94m new jobs

Construction is proceeding at the site of the new national stadium, which will be the main venue for the 2020 Olympics, in Tokyo.

TOKYO -- The Tokyo Metropolitan Government said on Monday the 2020 Tokyo Summer Olympics and Paralympics will create economic benefits totaling 32.3 trillion yen ($283.50 billion) across Japan.

The international sporting events are also expected to create some 1.94 million jobs, the municipal government said.

The estimate of economic effects covers the 18 years from 2013, when Tokyo was chosen to host the Olympics and Paralympics, to 2030. It is a combination of direct and legacy effects that will be created by staging the events. 

Direct effects consist of expenditures on construction and maintenance of venues for games and on management of the events, including security and transportation costs as well as spending by visitors, marketing expenses by sponsor companies and other expenditures. The Tokyo government estimates them to be 5.2 trillion yen.

Legacy effects are estimated at 27.1 trillion yen. They include expenditures on infrastructure improvements, barrier-free measures, an increase in the number of tourists visiting Japan from abroad, use of venues for other games and an increase in the numbers of sports players and sporting events.

Data on the 2012 London Olympics and Paralympics suggest that the economic effects of the games last for about 10 years after they are held, said an official in charge in the Tokyo government.

The combined estimate of some 32 trillion yen is broken down into 21 trillion yen between 2013 and 2020 and 11 trillion yen between 2021 and 2030, according to the municipal government. While the effects for Tokyo are estimated to account for some 60% or 20.4 trillion yen of the total, locations outside the capital are projected to receive 11.9 trillion in effects, such as a boost in tourism.

The Tokyo government also estimated that direct and legacy effects of the events will create some 306,000 and 1.63 million jobs, respectively. The total includes 1.29 million in Tokyo.

"The events will be held mainly in Tokyo but will produce widespread spillover economic effects for other places," the official said.

While campaigning to host the events, the Tokyo government announced an estimate in 2012 that projected a boost worth 3 trillion yen. But that figure has increased sharply because of increases in expenditures on construction and maintenance of venues and on management of the events as well as the addition of legacy effects for the first time. 

The estimate by the municipal government does not include changes in Japan's overall economic condition and falls in demand following the events.

The Bank of Japan has announced an estimate that the 2020 Olympics and Paralympics will push up Japan's gross domestic product by a total of 25 trillion yen to 30 trillion yen in 2014-2020. Mizuho Research Institute estimates a GDP bump of 36 trillion yen for fiscal 2015-2020.

(Nikkei)

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