The Main Aim of the Report
The main aim of this report is to determine whether hosting the Olympic Games is beneficial to the host country or not. This report uses SWOT analysis approach to identify strength, weakness, opportunities, and threats associated with hosting the Olympic Games in the current era.
The Current State of Hosting the Olympic Games
Currently, the costs of hosting the Olympics Games have skyrocketed, while the economic benefits are far from clear[i]. This situation has reduced the number of states interested in organizing this activity. Unlike previous years where countries competed vehemently to host this activity, the list of interested candidates to host it in 2024 Olympics has reduced drastically[ii].
Debating the Benefits of Hosting the Olympics
Hosting the Olympics is expensive and has always raised questions on the benefits associated with it primarily for the host country, concerning preparations. However, there is still a common belief among the general populace that taking on the challenge of being a host city for Olympics Games is an economically smart move. For years economists have debated whether the organization of the modern Olympic Games is a matter of honor or a matter of money, with no clear answer. This report seeks to answer this question by examining whether the benefits of hosting the Olympics Games are valid and if they are substantially inflated, or non-existent.
Strengths of Hosting Olympic Games
SWOT Analysis demonstrates that hosting Olympic Games have the following strengths;
- Olympic Games can bring direct economic benefits to the host state, for example, the host improves infrastructure and benefits from direct financial gains/revenues from the sale of tickets and tourism[iii].
- The states hosting Olympics games usually experience multiplier effects in which induced spending from tourists, employment increases, and overall economic stimulus supplement the direct economic impacts.
- Besides, the hosting city benefits from local pride that put the city 'on the map' - increase the city's visibility and its attractiveness, which in turn leads to more investments and increase in trade.
Weaknesses and Opportunities
On the weakness side, some of the direct benefits like infrastructure might tend to be idle after the games are over. Such scenarios leave many cities with facilities that cost hundreds of Millions of dollars to build and nothing to use them for after Olympics. Besides, the countries hosting Olympic Games gain the advantage of the following opportunities for tourism and economic development due to the infrastructure and exposure gained from hosting the event. Opening for the host country to showcase themselves to the rest of the world; participation from almost all countries of the world; Co-sponsors include the top brands of the world as it is the most prestigious sporting spectacle.
Threats Associated with Hosting Olympic Games
SWOT analysis approach demonstrates that Olympic Games pose severe threats to the functionality of the host country[iv]. Threats from terrorist attacks are likely to increase in the future. Also, the state might suffer from an economic recession, following the effects of massive borrowing when building the infrastructures to be used during the Olympics.
[i]
Overmyer, Michael P., (2017). Economic Impact Analysis on Olympic Host-Cities. Honors Projects. 647.
[ii]
Huggler, J., (2015). Hamburg withdraws bid to host 2024 Olympics. Accessed at: https://www.telegraph.co.uk/news/worldnews/europe/germany/12025211/Hamburg-withdraws-bid-to-host-2024-Olympics.html
[iii] Kostas K, Kiki, K, George, K, (2010). Event leveraging of mega sport events: a SWOT analysis approach. International Journal of Event and Festival Management, 1:3, 170-185.
[iv]
Scandizzo, P. and Pierleoni, M. R. (2017). Assessing the Olympic Games: the economic impact and beyond. Journal of Economic Surveys. 32: 10, 1111-1221.
