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The Tokyo Olympics will need a public bailout of about $ 800 million if the games are held behind closed doors while organizers delay the decision of national spectators until the last possible moment.
Recent budgets show that the organizers of Tokyo 2020 continue to take on full stages. After spending the billions of yen raised on ticket sales, a new taxpayer grant would be the only way to fund reimbursements, according to a Financial Times analysis of the organizing committee’s accounts.
With the Japanese government determined to move forward and hold the games from July 23, the decision to allow local fans to enter the stadiums has become one of the biggest controversies surrounding the Olympics.
Speaking at the G7 summit in Cornwall, Prime Minister Yoshihide Suga noted that Japan was determined to allow spectators if it could.
“Given the level of Covid-19 infections, we will decide [on capacity] according to the number allowed at other sporting events, ”he said.
If spectators are totally or partially banned, the city of Tokyo will be stuck to return their tickets after agreeing to it. subscribe the cost of the staging of the delayed games.
Of the $ 668 billion ($ 6.1 million) revenue the organizing committee has budgeted for this year, $ 90 billion ($ 822 million) is expected to come from ticket sales, which represents about half of Tokyo 2020’s commercial revenue. The rest already comes from public funding.
A balance sheet released for Tokyo 2020 last week showed a liability of 118 118.3 billion for the advance payments received. Most of this represents the ticket revenue of the Japanese public, who handed over their cash almost two years ago.
Doctors and public health experts have advised Japan to hold the Olympics without spectators avoid spreading Covid-19, but organizers and sponsors are desperate to keep at least some fans to get a return on their investment.
Shigeru Omi, the chief medical adviser on the government pandemic, has urged him to avoid a “festival mood” at the games. Fans who celebrate and drink would lead to the kind of high-risk socialization that spreads the disease, he warned.
“If it is held, the only option is for there to be no spectators,” Haruo Ozaki, president of the Tokyo Medical Association, said at a recent press conference.
Tokyo continues to report 300-400 new cases of Covid-19 each day and will have to remain in a state of emergency until June 20. Olympic organizers have delayed the decision on spectators until the end of June, in the hope that the situation of the virus will have improved.
Sponsors are anxious have spectators as they gave away tickets to some of the highlights of games in competitions and other marketing events.
“A big issue for sponsors is whether they can afford to assist the winners of the consumer campaigns they started doing before the games last year,” said a marketing executive advising several Tokyo 2020 sponsors on how to manage the games.
“Most sponsors have already benefited a lot from ticket campaigns. If these tickets are canceled, they will be affected by many reactions.
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