All eyes on Olympics’ economic effect
PyeongChang Games to create boon
The long-awaited first Winter Olympic Games will come to the alpine town of PyeongChang in 99 days, casting wonders not only on the dramatic moments the athletes will create; but also grabbing attention is the economic impact that the international winter sporting event will bring to Korea.
With the global community pursuing small but economically efficient events rather than massive and extravagant ones, Korea, the host of the PyeongChang Olympics, is also paying keen attention on how the Winter Games can contribute to its economy.
Outlook on the PyeongChang Olympics’ economic effect varies among institutions and organizers, but they all agree the Games will bring tens of trillions of won for a decade, tantamount to tens of billions of dollars.
Last November, PyeongChang Olympics chief organizer Lee Hee-beom said the organizers expect the event will create economic effects worth up to 32.2 trillion won ($28.65 billion) over the next 10 years.
Also, he estimated 390,000 foreign and 2.2 million domestic tourists would visit Gangwon Province, where PyeongChang is located, during and after the Games, which will be a huge opportunity for the region to promote its scenic nature as a tourism spot.
Hyundai Research Institute estimates that the effect will be twice the organizers’ outlook, standing at 64.9 trillion won for the next decade.
In a breakdown, the private think-tank estimated that investments in infrastructure and increased consumption will generate effects worth 21.2 trillion won.
A total of 7.26 trillion won was invested in infrastructure for the Games, such as venues, transportation networks and accommodations and these will draw 16.4 trillion won of economic effects. Also, increased consumption will bring 4.7 trillion won of economic effects.
The institute also anticipated indirect effects will be 43.8 trillion won, far greater than the aforementioned direct effects.
It assumed the number of visitors to the region will increase from 10 million to 11 million for the next 10 years and the increase will create 32.2 trillion won of economic effects.
Hyundai also counted the effects of national promotion, which will be worth 11.6 trillion won.
The organizers and the government are seeking to nurture PyeongChang as a profit-making tourism spot and maximize the economic effects of the Olympic Games, like Japan’s Sapporo became a tourist spot after hosting the 1972 Winter Games.
In order to do so, they are in cooperation with info-tech companies to provide tailored information to visitors from their arrival in Korea to their departure.
Along with these efforts, the organizers are striving to contain expenses in order to frame the event in a more economic way.
So far, the organizers spent 880 billion won in building six new venues and renovating six existing ones.
The average cost of four previous Winter Olympics stood at 3.7 trillion won and the organizers are making efforts to prevent the costs of the PyeongChang Games from getting beyond that.