Are big sports events really worth the headache?

For the foreseeable future, the perception that hosting such sporting events is a major symbol of national prestige will continue to trump the headaches that can come with staging them

  
Security personnel stand guard near the Olympic rings monument during a rally by anti-Olympics protesters outside the Japanese Olympic Committee headquarters, amid the coronavirus disease (COVID-19) outbreak, in Tokyo, Japan May 18, 2021.

Security personnel stand guard near the Olympic rings monument during a rally by anti-Olympics protesters outside the Japanese Olympic Committee headquarters, amid the coronavirus disease (COVID-19) outbreak, in Tokyo, Japan May 18, 2021.

REUTERS/Issei Kato

A summer of sporting risk and uncertainty begins next week with the European football championships (Euro 2020), the world’s third-biggest sporting event, followed by the Tokyo Olympics in July — which the Japanese government insists will take place despite growing public opposition.

While hosting such major events enhances national prestige, both were postponed for a year because of the COVID-19 pandemic. The health, political and wider risks and controversies afflicting such tournaments underline the challenges associated with them, not least the huge operational and security costs.

For example, the previous European football championships (Euro 2016), which UEFA awarded to France to great fanfare in 2010, took place under an official state of emergency following the 2015 terrorist attacks in Paris. The US State Department warned that the event could be a target for further terrorist atrocities, only the third time in about 20 years that such cautionary advice was issued by the US government for European travel, and French authorities had to deploy about 90,000 police, soldiers and security guards.

The 2016 Olympics in Rio offered an even starker example of the political and wider risks of hosting major sporting events. In 2009, when the city won the right to host the games, the national economy was booming and Brazil was enjoying significantly enhanced international prestige as a leading BRICS emerging market. By 2016, however, it was mired in political crisis surrounding the impeachment of President Dilma Roussef, and the worst recession in decades had forced significant cuts to the Olympic spending budget. In addition, more than 100 prominent doctors and professors wrote an open letter to the World Health Organization asking for the games to be postponed or moved from Brazil “in the name of public health” because of the Zika virus epidemic.

Despite the fillip to national pride, there is growing evidence that major sporting events do not provide a substantial boost to national economies from capital investment and tourism. For Euro 2016, the total investment in modernising new stadiums alone was estimated at 1.6 billion euros, more than the target of 1.4 billion euros for broadcast rights and sponsorship income. The mismatch between revenue and expenditure was, if anything, even starker with the Rio Olympics. Brazil spent at least $10 billion on the event, in excess of the revenue the Games generated, partly because Zika discouraged many tourists from traveling. In addition, many of the spectators at major events come from the host country, and their spending often simply displaces that on other domestic leisure services.

The legacy benefits can be limited too. Newly built Olympic facilities (aside from the Olympic Village, which can be sold as apartments) are often too large for most conventional sporting uses, and have significant maintenance costs, often leading to them being dismantled after the event.

Despite all these pitfalls, however, there is no shortage of cities wanting to host the 2032 Olympics, with Brisbane the frontrunner to follow Paris in 2024 and Los Angeles in 2028. Numerous countries have already expressed an interest in hosting the 2028 European football championships after Germany in 2024, including Romania, Greece, Bulgaria and Serbia.

A long list of states are bidding for the 2030 football World Cup, including Morocco, the UK and Argentina, after Qatar in 2022 and Mexico, Canada and the US in 2026.

What this underlines is that, for the foreseeable future, the perception that hosting such sporting events is a major symbol of national prestige will continue to trump the headaches that can come with staging them.

  • Andrew Hammond is an Associate at LSE IDEAS at the London School of Economics
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