After Sochi 2014: costs and impacts of Russia’s Olympic Games

Abstract

This paper assesses the outcomes of the 2014 Winter Olympic Games in Sochi, Russia, examining the costs and economic impacts of the event, the prospects for the long-term use of venues and infrastructure, and the attitudes of the global and the Russian population. Total costs were $55 billion, having increased 4.5 times from $12 billion at the time of the bid. Of this total, about $16 billion were sports-related costs. After accounting for inflation, this makes Sochi the second-most expensive Olympics ever in terms of sports-related costs and the most expensive Olympics in terms of cost per event. With a public share of 96.5 percent of funding, the Sochi Games had the highest proportion of public money for any Olympic Games on record. The benefit from this high cost, however, is limited. Extensive construction led to hotel overcapacities, investors defaulted on state-backed loans, and there is no coherent plan for the after use of venues and some of the largest infrastructure projects. As a consequence, the Sochi Olympics will continue to be a burden for the Russian state, with expenses for operation, maintenance, and foregone interest and tax revenue in the order of $1.2 billion per year. The event also did not manage to improve the image of Russia in the world. Among the domestic population, support dropped over the seven years of its implementation, most notably among the local population.

How mega-events capture their hosts: event seizure and the World Cup 2018 in Russia

“…Consulting companies have issued reports extolling the multiple benefits of hosting mega-events (Ernst & Young, 2011;PricewaterhouseCoopers, 2011). Thus, the World Cup 2010 in South Africa aimed to reduce poverty (Pillay & Bass, 2008), the Olympic Games in London were a vehicle to revitalise boroughs in East London (Poynter & MacRury, 2009), the Winter Olympics 2014 in Sochi were meant to turn the destination into a world-class winter sports resort (Müller, 2014) and the World Cup 2014 in Brazil and the 2016 Summer Games were to advance urban transport and upgrade neighbourhoods in Rio de Janeiro (Gaffney, 2010).…”

“…Officials went to great lengths to point out that there would be a break with the profligate planning for the Winter Games in Sochi, which cost USD 55 billion-an unparalleled amount (Müller, 2014). In the wake of the financial crisis, the preparation for the World Cup was to "demonstrate a novel approach to the planning of state expenditure" .…”

Leveraging Mega Events for Capacity Building in Voluntary Sport Organisations

“…The appeal of mega sport events to national political and business elites for promoting various policy agendas is well-documented (Gold and Gold 2011;Müller 2015). UK developed a deliberate policy for hosting mega sport events and invested £22 million in bidding for them (UK Sport 2005.…”

From a sports mega-event to a regional mega-project: the Sochi winter Olympics and the return of geography in state development priorities

“…On this basis, many commentators were quick to prophesy that the key stadiums were doomed to collect dust and fall into white elephants. Although a direct payback on the investment in these facilities is indeed questionable (Müller 2014a), the future is by no means predetermined here. What is often overlooked is that the centralisation of power in Russia also means the immediacies of administrative levers -the future of using the stadia will depend on how much priorities the Russian state will make for this.…”