What did France do to save money for the Olympics and what did it get?

(Dan Tri) - France has planned to reduce spending at this Olympics by reusing, recycling and renting, but the lack of air conditioning, cardboard beds, and polluted Seine River... have caused many mixed opinions.

The cost burden is becoming the main reason why fewer and fewer cities around the world are bidding to host the Olympics. Recent Olympics have cost tens of billions of dollars and have barely made a profit. The 2012 London Olympics required an investment of $16.8 billion. The 2020 Tokyo Olympics also required an investment of more than $13.7 billion. Meanwhile, the Rio Olympics cost $23.6 billion, more than 350% overspent. This year, the Paris Olympics organizing committee was given a budget of $4.7 billion from ticket sales, sponsors and the International Olympic Committee (IOC). However, the French government has also spent billions more to build the Olympic village and other infrastructure. According to French estimates, the total cost of the 2024 Paris Olympics is nearly $9.7 billion. However, official figures will take some time to be fully calculated. Experts say costs are often difficult to predict or determine. The 2021 Tokyo Olympics will cost an estimated $12.9 billion. The 2004 Athens Olympics cost about $9.1 billion, according to the country's finance ministry. Independent organizations, however, say the figure is closer to $15 billion.

Use recycled materials

Since taking over as host, France has aimed for an Olympics with a 50% reduction in carbon emissions compared to the average of London 2012 and Rio 2016. Thanks to this green orientation, France hopes to have a sustainable, less expensive Olympics. The Paris 2024 Olympics are also expected to be the first Olympics to be aligned with the Paris Agreement on climate change, as well as the International Olympic Committee's Agenda 2020 for a more sustainable and green approach. The Paris 2024 Olympic Athletes' Village is spread over 82 buildings, including around 3,000 apartments and 7,200 rooms. Described as a "city in miniature", the project has been under construction for nearly 7 years and aims to become the most sustainably built residential complex in the history of the Olympics. The eco-friendly approach and low-carbon design have received near-universal praise from climate-conscious critics. Some of the infrastructure’s interior furnishings are made from recycled materials to ensure sustainability and cost savings. In the Olympic village, athletes will sleep on mattresses made from recycled fishing nets and beds made from cardboard.

Simple, non-air-conditioned bedrooms for athletes at the Paris Olympic Village (Photo: Getty Images).

The cardboard beds in the athletes' bedrooms in the Olympic Village are part of an effort by the organisers to reduce the carbon footprint of what they claim will be the greenest Games ever. However, athletes have complained that they are uncomfortable. Instead of air conditioning, organisers are using geothermal systems that cool water under the floors to help athletes cool down. Renewable energy is also being used. The new aquatics centre in Saint-Denis and the Olympic Village are powered by solar panels. In addition to using 100% renewable energy throughout the Games, Paris will also reduce its use of diesel generators. The few generators that will be used will run on biofuels, hydrogen or batteries.

Take advantage of available facilities

According to the organizers, each venue was meticulously planned for the resources needed to minimize and control their life cycle before, during, and after the Games. Everything from spectator seating to tents, beds, chairs, tables, and even tennis balls were meticulously planned. This approach helped organizers reduce the number of items needed for the Games from an initial estimate of 800,000 items to 600,000. The top cost-cutting measure was to make use of existing facilities. Ninety-five percent of the venues are either pre-existing or temporary. “The plan from the beginning was to save money and not invest in things that are not useful,” Etienne Thobois, CEO of the Paris 2024 Olympic Organizing Committee, told the Washington Post . He believes the Games should adapt to the city, not the other way around. The Stade de France stadium in northern Paris, originally built for the 1998 World Cup, hosts most of the events. The Roland Garros tennis complex is also used for events.

A corner of the Olympic village in France (Photo: Getty).

Triathletes in the swimming, cycling and running events also competed on the Seine. France installed a 46,000 cubic meter reservoir near the Gare d'Austerlitz train station on the left bank of the Seine. The reservoir holds the equivalent of 20 Olympic swimming pools of rainwater and wastewater, reducing the amount of toxic substances that seep into the river. Beach volleyball also took place next to the Eiffel Tower. Fencing was held at the Grand Palais Museum and equestrian events were held in the gardens of the Palace of Versailles. This saved France some money and only had to spend on major new projects such as the Olympic village ($1.6 billion), the aquatics center ($190 million), and the gymnastics and badminton complex ($150 million). These infrastructures will be reused by France after the Games to avoid waste. Specifically, the Olympic Village will be converted into a residential and commercial area, providing apartments for 6,000 people. A quarter of the apartments will be used as social housing, serving 40% of the current residents in the commune of Saint-Denis. Another third will be rented out as affordable housing for students, low-income workers, etc.

Increase renting instead of buying new

In addition, of the 2 million pieces of sports equipment, about 75% are rented or provided by sports federations. More than 75% of electronic equipment such as monitors, computers and printers are also rented. All pavilions, tents and chalets are also rented. With this strategy, the organizing committee estimates that 90% of the 6 million pieces of equipment will be taken back and reused by partners. Alexander Budzier, an expert at the University of Oxford, assessed that Paris is on the right track. However, there are additional costs that France still has to pay out of pocket. Security and personnel costs may be higher. At the Paris Olympics, the final cost also depends on bonuses for metro drivers, police, medical staff and general security during the event. France has deployed 45,000 police and soldiers, along with 50,000 private contractors to protect the Olympics in the Paris region.

Triathletes swimming - cycling - running also compete right on the Seine River (Photo: MSN).

Bruno Cavalier, chief economist at financial services firm Oddo BHF, said the government's direct involvement would be relatively limited, so the event would not have a major impact on France's current $3.2 trillion public debt. In addition, the cost of cleaning up the Seine to make it suitable for swimming events would be around $1.5 billion, and the $3.8 billion expansion of Metro Line 14 would not be part of the Olympics budget. The CEO of the Paris 2024 Olympic Organizing Committee is confident that the Paris 2024 Olympic Organizing Committee will not spend more than it can earn, and hopes that its strategy will set a new standard for future Olympic models.

How does the French economy benefit from the Olympics?

Hosting major sporting events like the Olympics has always been an economic boon for the host country. In February, consultancy Asteres estimated that the Olympics would bring France $5.7 billion in tax and other revenue. France has so far spent about $3.26 billion on the Paris Games, equivalent to 0.1% of its GDP. Meanwhile, the International Olympic Committee, which receives money from major sponsorship deals and broadcasting rights, is contributing $1.31 billion. Paris also earns revenue from ticket sales, licensing and domestic sponsorship. The government can claim a short-term, one-off tax during the event from hotels and other tourist spending. The Center for Sports Law and Economics (CDES) estimates that the event could bring in $7.2 billion to $12 billion for Paris and surrounding cities. However, they also stressed that this is an economic benefit spread over about 20 years, starting from when Olympic preparations began in 2018.

The Olympic symbol is placed at the Louvre Museum in Paris (Photo: Reuters).

However, experts also say that it is difficult to accurately measure the impact of major events such as the Olympics. On the one hand, this event increases the number of jobs, attracts foreign tourists and promotes many commercial activities such as ticket sales, use of food services, shopping ... On the other hand, the Olympics can still dampen tourism, as airfares and hotels increase. Consumption will also decrease if many people choose to stay home to watch live television. Mr. John Grant, an analyst at the global travel data company OAG, said it is a common misconception that host cities often attract a huge number of tourists to visit during the Olympics. Meanwhile, the reality is that many people are afraid to visit the host city during that period. Many hotel chains in Paris have complained that the number of foreign visitors has decreased in the past few weeks, due to both the Olympics and bad weather. France's flagship airline Air France-KLM warned earlier this month that the Olympics could cost it $194 million in revenue as international travelers avoid Paris. Delta Air Lines is forecasting a loss of up to $100 million in revenue due to a sharp drop in tourism to France. "Unless it's the Olympics, people are not coming to Paris," Delta Air Lines CEO Ed Bastian told CNBC. In a June study, Deutsche Bank said that countries hosting the Olympics or the FIFA World Cup rarely make a profit from these events, given the huge investment in new stadiums and infrastructure. The independent economic research organization French Economic Observatory recently predicted that France's GDP would grow only slightly in the third quarter, at a rate of 0.3%. The French National Statistics Institute earlier this month forecast that France's economic growth rate would be 0.3% higher this quarter thanks to tourism, ticket sales and broadcasting rights. Accordingly, France's GDP could increase by 0.5% in the third quarter and by 1.1% for the whole year. For the Governor of the Central Bank of France, Francois Villeroy de Galhau, the Paris Olympics have a more spiritual impact than an economic one. However, he believes that France can improve its national image through the Olympics, thereby attracting new investments from abroad.

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