The German Institute for Economic Research (DIW) said Wednesday that Berlin’s potential 2024 Olympic bid could be the wrong financial decision with the city deep in debt and lacking the infrastructure to host such a global event.
Karl Brenke of the DIW, that specializes in macroeconomic developments in Germany, said Berlin should think twice about launching such a candidacy. He said history had shown initial estimates for the Games compared to what they end up costing were never the same, while budgets only include the cost for the duration of the Games.
He told Reuters, “costs that are Games-related and come up after the Olympics are systematically blended out. From the figures we have so far there is very little information about what they will actually cost for Berlin”.
Reuters reports Berlin officials have not provided a specific figure yet, but some estimates put the projected cost at about 2.5 billion Euros ($2.83 billion), roughly the same as past Games. But that does not include any other related investment in infrastructuer that may not be directly linked to the competitions but may be necessary for the event.
These generally include access roads, upgrading of public transportation and airports among other things which can command a total outlay several times larger than the Games budget.
Brenke said, “the state of Berlin has at the moment a debt of 65 billion Euros. I have the feeling that Berlin is sliding into something it may not be able to lift. But then again Berlin has experience in that”, he added with reference to the city’s new airport that has yet to open more than four years past its original delivery date due to a string of delays and construction problems.
He added that other German federal states providing some funds to Berlin would not be happy to see “Berlin affording itself the luxury of hosting the Olympics”.
He said that Hamburg’s candidacy would be equally problematic with the city having fewer venues and no Olympic stadium compared to the capital but a better urban infrastructure.
“If you look at the Olympics or the World Cup, the only real winner is (world soccer’s governing body) FIFA or the IOC. The city is always asked to pay more”, he said.
The German Olympic Sports Confederation (DOSB) will decide on the bid city in March and the International Olympic Committee (IOC) will select the winning candidate for the 2024 Games in 2017.