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How to effectively operate and manage the huge Olympic facilities after the Olympic Games?
The 2008 Beijing Olympic Games has entered the countdown stage, and various projects are in full swing. The economic benefits brought by the Olympic Games to China are self-evident. However, the "trough effect" brought by the Olympic Games will also appear, which should be paid enough attention to by China people who are full of joy in welcoming the Olympic Games. This paper talks about my own views and suggestions on how to avoid the post-Olympic economic risks.

[Keywords:] Post-Olympic risk trough effect

With the approach of the 2008 Olympic Games, Beijing's "Olympic economy" is in full swing. Since 2003, the Olympic economy has contributed more than 2 percentage points to Beijing's economic growth every year. In 2006, Beijing's economic growth rate reached 12%, maintaining double-digit growth for the eighth consecutive year, and house prices were also rising. According to the general law of Olympic economy, there will be a greater investment climax in the two years before the Olympic Games, so Beijing's economy is likely to reach a higher level in 2007. But this joy has also caused people to worry about the risks facing Beijing. After all, 15 days later, the host city of the Olympic Games actually assumed the debt for 30 years, which really happened. Throughout the history of modern Olympic Games, almost no host city has completely got rid of the so-called "post-Olympic economic risks".

First, the post-Olympic "trough effect" reasons

The so-called "Olympic trough effect" refers to the economic depression of the host city due to insufficient demand after the Olympic Games. Olympic economy has obvious characteristics of stages, which are divided into pre-Olympic stage, Olympic stage and post-Olympic stage by academic circles. The "Olympic trough effect" stems from the sharp contraction of long-term demand driven by the expansion of Olympic investment demand. Looking at the situation of the host country of the Olympic Games, the author summarizes the reasons as follows:

1. Budget implementation was seriously overspent.

Montreal, Canada is the host city of 1976 and 2 1 Olympic Games. The original budget was $6543.8+$25 million, but the actual expenditure was far out of control. The Organizing Committee vigorously built the Olympic Center in the north of the city, and built a large main stadium, swimming pool mud yard, Olympic Village and so on. These luxurious infrastructures consume huge financial funds. According to the estimate of Quebec government, the actual expenditure of this Olympic Games is 2.4 billion US dollars, nearly 20 times of the budget, and the construction of sports center is more than 6 times. After the Olympic Games, Montreal citizens took on a new kind of tax, which is called Olympic special tax, and it will last for 30 years. The total investment of Beijing Olympic Games is expected to exceed $35 billion, accounting for more than 43% of the total investment of previous Olympic Games since Montreal Olympic Games 1976. How to effectively implement the budget has posed an arduous task for China's budget management. Coupled with the corruption of government officials, the consequences are difficult to control.

The investment before the Olympic Games is huge.

Olympic investment includes direct investment and indirect investment. Olympic direct investment refers to the investment directly used in Olympic venues and service facilities, as well as the expenditure of organizational work. Olympic indirect investment refers to the investment made to improve the environment, transportation and communication infrastructure of the host city. Every Olympic Games will stimulate the investment demand of the host country, and Beijing is no exception. The total investment of the Olympic Games exceeds 35 billion US dollars, of which the direct investment for the construction and operation of Olympic venues is about 3.5 billion US dollars, while the indirect investment for urban infrastructure renovation and landscaping accounts for about 90%. How to recover this part of investment will be a difficult problem. It is obviously irrational to be blindly optimistic about the benefits brought by huge investment.

3. The utilization rate of venues is low after the games.

Hosting the Olympic Games is bound to build some competition venues and some sports facilities, and after the Olympic Games, it is bound to face problems such as venues being idle and paying huge maintenance fees. Whether it is the first commercial operation of the Los Angeles Olympic Games or the most successful Sydney Olympic Games, this problem occurs to varying degrees. In China, Nanjing Olympic Sports Center is the main venue of the 10th National Games, with a total investment of 2.2 billion yuan. After the 10th National Games, to maintain its normal operation, the monthly water and electricity will be as high as1.501.8000 yuan, and with other necessary expenses, the total annual operating cost will not be less than 60 million yuan. Then, we must plan ahead for the venues and facilities of the Beijing Olympic Games, make good responses in advance, and minimize the losses.

4. The Olympic bubble economy is getting worse.

Beijing's housing prices are still rising rapidly under the strong control of the state for two years. There are many reasons, one of which is the hype of "Olympic concept". High housing prices not only stimulate the supply of real estate, but also inhibit the growth of consumption, greatly reducing the quality of life of ordinary people. More seriously, high housing prices are likely to lead to the Olympic bubble economy. Once this bubble bursts, the damage to the economy will be very serious. A bullish stock market is also a potential danger. In the last six Olympic Games, the stock markets of all the host countries have made some gains in the year before the Olympic Games, among which the growth rates of South Korea (1988), Greece (2004) and the United States (1996) reached 90%, 29% and 33% respectively. At present, China stock market is becoming more and more frothy. Once speculators are busy withdrawing funds, the investment after the Beijing Olympic Games will fall faster than expected.

Second, measures to avoid risks.

1. Effective budget execution

The budget for the Beijing Olympic Games is $35 billion, so such a huge sum of money must be used effectively. In the implementation, we should do the following: First, the formulation of the Olympic budget should reflect the interests of the people of the whole country. Secondly, when implementing Olympic projects, it should be implemented through government procurement. This includes taking a series of market-oriented measures, such as international bidding, introducing international talents, opening up construction projects, increasing transparency, and strengthening the restriction and supervision mechanism, so as to strengthen the financial management function and improve the efficiency of the use of financial funds. Finally, we should strengthen audit supervision, ensure the effective implementation of the Olympic budget, avoid the uncertainty of budget implementation, and make the whole Olympic Games a clean Olympic Games.

2. Establish a diversified investment and financing mechanism.

The proportion of investment in the early stage of the Olympic Games is large, and it is obviously not enough to rely solely on the government. For some important projects, relying only on government subsidies has increased the financial burden of the government. We can raise money by issuing bonds publicly. At present, China mainly issues bonds through the central government and uses them locally, which leads to systemic risk concentration. In fact, we can try the method of issuing bonds by local governments. The Beijing Municipal Government will issue special Olympic bonds to raise funds from the whole society. Olympic special bonds can be issued in this city, but also to the whole country and overseas. According to the construction progress and demand, it can be distributed in years. After they are issued, they can be circulated and discounted. After the expiration, it will be repaid with the increased income from hosting the Olympic Games. The advantages of this are: first, it reduces the financial burden of the central government; Second, it has increased the responsibility of the Beijing Municipal Government. The municipal government should be responsible for its own borrowing behavior and bear the responsibility of repaying the principal and interest, so that it can use the borrowed money more effectively. More importantly, this attempt is conducive to promoting financial system reform and financial market development. In addition, we can reduce the pressure of government investment through public bidding and social investment, and enterprises can also find their own platform in the government's market development.