Rio is stuck with big bills and vacant venues after Olympics
RIO DE JANEIRO — Rio de Janeiro pulled off last year’s Olympics, keeping crime at bay and fending off dire forecasts of corruption, environmental degradation, and cost overruns.
Six months after South America’s first games, the flood gates have burst open.
Rio organizers still owe creditors about $40 million. Four of the new arenas in the main Olympic Park have failed to find private-sector management, and ownership has passed to the federal government. Another new arena will be run by the cash-strapped city with Brazil stuck in its deepest recession in decades.
The historic Maracana stadium, site of the opening and closing ceremony, has been vandalized as stadium operators, the Rio state government, and Olympic organizers have fought over $1 million in unpaid electricity bills. The electric utility reacted by cutting off all power to the city landmark.
There are few players for a new $20 million Olympic golf course, and little money for upkeep. Deodoro, the second-largest cluster of Olympic venues, is closed and searching for a management company.
The state of Rio de Janeiro is months late paying teachers, hospital workers, and pensions. The state also reports record-breaking crime in 2016 in almost all categories from homicides to robbery.
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“During the Olympics, the city was really trying hard to keep things together,” said Oliver Stuenkel, a Brazilian who teaches international relations at the Getulio Vargas Foundation, a Brazilian university. “But the minute the Olympics were over, the whole thing disintegrated.”
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BETTER IMAGE, OR WORSE?
The Olympics — and to a lesser extent the 2014 World Cup — showcased the reality of Rio, a city romanticized for its sprawling beaches, annual Carnival celebration, and sensual lifestyle.
It also exposed the city’s crime, environmental contamination, and corruption.
Some building projects connected to the Olympics and World Cup have been tied to a probe which has led to the jailing of dozens of politicians and businessmen for receiving kickbacks in Brazil’s largest corruption scandal.
Three politicians who were instrumental in landing and organizing the Olympics — former Brazilian President Luiz Inacio Lula da Silva, former Rio governor Sergio Cabral, and former Rio Mayor Eduardo — have been under investigation. Cabral, an early promoter of the Olympics and World Cup, has been jailed on corruption charges.
“The Olympics gave people a better sense of the difficulties Brazil faces,” Stuenkel said. “Maybe not a better or worse image, but more rounded.”
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UNPAID BILLS
Sidney Levy, the chief executive officer of the Rio organizing committee, tried to run the games with only private money, and almost succeeded. His $3 billion operating budget — the budget for running the games, not building the infrastructure — was frugal by Olympic standards. At the last minute, he had to ask for a 250-million-real bailout — $80 million — from the city of Rio and the federal government to run the Paralympics.
Eventually, he got only 100 million reals ($30 million), and the shortfall has left organizers owing creditors millions.
Today, Levy says he’s nearly a forgotten man.
“I could call the president of the country, and the call was taken,” Levy said. “But try it today. I could call the IOC and everybody. But now people have other things to handle. We are no longer a priority.”
Levy said organizers probably lost about $200 million in income during the run-up to the games as sponsors backed out of expensive deals as the recession kicked in.
Levy said he has not asked the IOC to help pay debts, but acknowledged the Olympic body came up with millions in advance money several times during the run-up to the games.
“The whole thing was too painful,” Levy told The Associated Press. “We never really enjoyed the games, themselves; 2016 was just extremely hard. It’s like we were climbing Everest, and ice is falling on your lips, and you are not seeing.”
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WHITE ELEPHANTS
The Olympic Park is a ghost town; sleek sports arenas without events, deserted before they were even broken in, and well-tended flower gardens, free from pedestrian wear-and-tear.
“The arenas are beautiful,” Wagner Tolvai said, walking inside the park with his girlfriend Patricia Silva. “But it’s all abandoned, everything has stopped. Nobody is here.”
He likened the 2.5 billion real ($800 million) park to a new shopping mall “without stores, or customers.” The park is only open on weekends, and there’s not much to do but walk, pedal a bike, or look for shade.
Four permanent arenas are being run by the federal government. Among them is the Olympic tennis center, which was used earlier this month for a one-day beach volleyball tournament. This in a city with endless sand and beaches.
Two temporary venues for swimming and handball have yet to be dismantled. The exterior of the swimming venue is falling apart and many translucent tapestries that covered the outside of the building are frayed or falling to the ground.
The warm-up pool, which was covered during the games, is filled with muddy, stagnant water.
Away from the park, the famous Maracana stadium has drawn the most attention. It was renovated for the 2014 World Cup at a cost of about $500 million. It was largely abandoned after the Olympics and Paralympics, and then hit by vandals who ripped out thousands of seats and stole televisions.
“The Maracana is the biggest symbol of the way the games were managed,” said Mauricio Santoro, a political scientist at Rio de Janeiro State University. “The vast majority of people in Rio will never go to the golf course, or the Olympic venues. But the Maracana is different. It’s the jewel of the crown.”
Up the road from the Olympic Park, the $1 billion Athletes Village — it housed about 10,000 athletes — is fenced off and empty. The developer says it has sold only 260 of the 3,604 apartments — about 7 percent.
Rio’s Globo newspaper reported that new Rio Mayor Marcelo Crivella is arranging low-cost loans for public employees to buy the units.
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SUBWAY AND BUSES
Transportation projects driven by the Olympics look better than the sports venues.
The games led to a subway line extension, though at the reportedly inflated price of $3 billion. They also produced a high-speed bus network, a light-rail line, and a pedestrian-friendly, renovated port area. Rio’s international airport also got a makeover.
People using the new subway line have benefited, though city traffic is still badly snarled.
But many of the improvements benefit mostly the wealthy south and west of the city.
“The gains were unevenly spread across the city,” Stuenkel, the political scientist said.
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TOKYO 2020 ADVICE
Levy, the CEO, said Tokyo’s 2020 Olympics will face completely different challenges.
“They have a society that works pretty well already,” he said. “They don’t have to prove anything to anybody.”
Tokyo will face higher costs than Rio, and organizers are already looking for places to cut.
Levy suggested reining in sports federations, which all want five-star treatment. He used an example from the equestrian events.
“They wanted 15 horse ambulances,” Levy said. “We offered nine. In the end, the right number was four. The magic of the games doesn’t come from these things.”
14 responses to “Rio is stuck with big bills and vacant venues after Olympics”
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Good thing “America Last” Obama is gone. He’d be sending millions of our tax dollars in relief to Rio because he’s such a nice guy.
Good thing “America First” Trump is here. He’s going to spend millions (perhaps billions) of our tax dollars on a wall, then he’s going to make the American taxpayers pay for it again with 20% tariffs because he can’t get anyone else to pay for it.
Make America Great again! Millions out of work, millions survive on Gov. handouts and we have Liberal Judges siding with an openness for migrants from another Country over US Citizens. Barry doubled the National Debt by himself the last 8 years. Yeah, Bushes Fault! right?
Apparently the Libertard/Democrat PYRAMID scheme of collecting more taxes with open borders having migrants work on the cheap or contribute to the US somehow ain’t working.
Agree, 33% of the entire population on Oahu is living below the federal poverty line! That number will grow to 70% if the “D”onkey politicians keep pandering to illegals as they take every job they can grab! S_T_U_P_I_D “D”onkey voters keep thinking the “D” party and their agenda is their friend. Little do they know that the “D” party is supported by the elite and wealthy wanting to lower the average wage of their workers.
I blame the Olympic committee for selecting Brazil. Everyone knows it’s not a safe place to visit. Brazil will now become more of a criminal state, disease and filth. I certainly would not even consider visiting Brazil now or forever.
Brazil was always corrupt and a criminal state
I know this probably won’t fly, but I think the Olympic Summer Games should be held in Greece, ALL THE TIME. Every 4 years, the world comes together in Greece, the founding country of the Olympics at a PERMANENT site. Every country entering athletes would pay a pro-rated “maintenance fee” (based on approximate size of contingent) to Greece for upkeep of the facilities, security, etc. In off years, the Greeks can use the facilities for their own purposes such as soccer matches, basketball games, etc. To satisfy the different countries hosting issue, a different country can be selected to do the opening and closing ceremony every 4 years. This would prevent problems like Rio is having as well as Beijing when China hosted. You KNOW countries will try to outdo each other as hosts, putting huge amounts of money into an event that basically lasts only a couple of weeks. The advantage of always having it in one country is that systems such as security, housing, meals, etc. can be improved each time with a common site instead of having to re-invent the wheel every 4 years.
Interesting idea.
Greece that wheel!
I agree that Greece should hold the Olympics so that there is no need to build one-time facilities and venues every four years. Also, Greece should hold opening and closing ceremonies there, too. I agree with all your other ideas of financing. One change I would make is that Greece would not be the automatic host of sports teams and I’d also change the qualifying rules of volleyball. Central America including the Caribbean have their own continental qualifier as well like South America and North America. Europe that has many more states could be split into West Europe qualifier and East Europe Qualifier. Asia, the biggest continent could be split into Middle East amd Far East. Australia and New Zealand could join the Polynesian qualifier. That leave four teams to vie for the last four spots.
It used to be that the hosting of the Olympics would bring a tangible benefit to the city hosting. I think you could go back to Montreal in ’76 and start to see the shift that has almost come full circle now – no matter where you hold it it will be a bomb financial wise. Your idea to have the Olympics permanently held in Athens. It will be a logistical nightmare though if you have the opening and closing happen in another country in which all the athletes will need to be at in the tradition of the Olympics, and then fly to Greece for the actual competitions.
Kennie 1933, common sense like yours are rarely embraced. People have so many other political correct ideas their awareness of simplistic venues are shrouded and blinded by their idiocies!
Hope Utah gets the Winter Olympics in the future…..they will recycle stuff from the 2002 Olympics…..put Mitt in charge…they are ready to rock n’ roll!