What did France do to save money for the Olympics and what did it get?

(Dan Tri) - France has planned to reduce spending at this Olympics by reusing, recycling and renting, but the lack of air conditioning, cardboard beds, and polluted Seine River... have caused many mixed opinions.

The cost burden is becoming the main reason why fewer and fewer cities around the world are bidding to host the Olympics. Recent Olympics have cost tens of billions of dollars and have barely made a profit. London 2012 required an investment of $16.8 billion. Tokyo 2020 also required an investment of more than $13.7 billion. Meanwhile, Rio Olympics cost $23.6 billion, more than 350% overspent. This year, the Paris Olympic organizing committee was given a budget of $4.7 billion from ticket sales, sponsors and the International Olympic Committee (IOC). However, the French government has also spent billions of dollars to build the Olympic village and other infrastructure. According to French estimates, the total cost of the Paris Olympics 2024 is nearly $9.7 billion. However, official figures will take some time to be fully calculated. Experts say costs are often difficult to predict or determine. The 2021 Tokyo Olympics will cost an estimated $12.9 billion. The 2004 Athens Olympics cost about $9.1 billion, according to the country's finance ministry. Independent organizations, however, say the figure is closer to $15 billion.

Use recycled materials

Since taking over as host, France has aimed for an Olympics that will reduce carbon emissions by 50% compared to the average of London 2012 and Rio 2016. Thanks to this green orientation, France hopes to have a sustainable, less expensive Olympics. The Paris 2024 Olympics are also expected to be the first Olympics to be aligned with the Paris Agreement on climate change, as well as the International Olympic Committee's Agenda 2020 for a more economical and green approach. The Paris 2024 Olympic Athletes' Village is spread over 82 buildings, including around 3,000 apartments and 7,200 rooms. Described as a "city in miniature", the project has been under construction for nearly 7 years and aims to be the most sustainably built residential complex in the history of the Olympics. The eco-friendly approach and low-carbon design have received near-universal praise from climate-conscious critics. Some of the infrastructure’s interior furnishings are made from recycled materials to ensure sustainability and cost savings. In the Olympic village, athletes will sleep on mattresses made from recycled fishing nets and beds made from cardboard.

Simple, non-air-conditioned bedrooms for athletes at the Paris Olympic Village (Photo: Getty Images).

The cardboard beds in the athletes' bedrooms in the Olympic Village are part of the organizers' efforts to reduce the carbon footprint of what they say will be the greenest Olympics ever. However, athletes have complained that they are uncomfortable. Instead of installing air conditioning, the organizers are using geothermal systems that cool water under the floors to help athletes avoid the heat. Renewable energy is also being used. The new aquatics center in Saint-Denis and the Olympic Village are powered by solar power. In addition to using 100% renewable energy during the Games, Paris will also reduce the use of diesel generators. The few generators that will be used will run on biofuels, hydrogen or batteries.

Take advantage of available facilities

According to the organizers, each event venue was meticulously planned for the resources needed to minimize and control their life cycle before, during, and after the Games. From spectator seating to tents, beds, chairs, tables, and even tennis balls, everything was meticulously planned. This approach helped organizers reduce the number of furniture needed for the Games from an initial estimate of 800,000 items to 600,000. The top way to reduce investment costs was to take advantage of existing facilities. 95% of the venues are pre-existing or temporary. "The plan from the beginning was to save money and not invest in things that are not useful," Etienne Thobois, CEO of the Paris 2024 Olympic Organizing Committee, told the Washington Post . He believes the Olympics should adapt to the city, not the other way around. The Stade de France stadium in northern Paris, originally built for the 1998 World Cup, hosts most of the events. The Roland Garros tennis complex is also used for events.

A corner of the Olympic village in France (Photo: Getty).

Triathletes in swimming, cycling and running also compete on the Seine. France has installed a 46,000 cubic meter reservoir near the Gare d'Austerlitz train station on the left bank of the Seine. This reservoir holds the equivalent of 20 Olympic swimming pools of rainwater and wastewater, helping to reduce the level of toxicity seeping into the river water. Beach volleyball also takes place next to the Eiffel Tower. Fencing is held at the Grand Palais Museum and equestrian events are held in the gardens of the Palace of Versailles. Thanks to this, France has saved some costs and only has to spend on major new projects such as the Olympic village (1.6 billion USD), the aquatics center (190 million USD), the gymnastics and badminton area (150 million USD). These infrastructures will be reused by France after the end of the Olympics to avoid waste. Specifically, the Olympic Village will be converted into a residential and commercial area, providing apartments for 6,000 people. A quarter of the apartments will be used as social housing, serving 40% of the current residents in the commune of Saint-Denis. Another third will be rented out as low-cost housing for students, low-income workers...

Increase renting instead of buying new

In addition, of the 2 million pieces of sports equipment, about 75% are rented or provided by sports federations. More than 75% of electronic equipment such as monitors, computers and printers are also rented. All booths, tents and chalets are also rented. With this strategy, the organizing committee estimates that 90% of the 6 million pieces of equipment will be taken back and reused by partners. Alexander Budzier, an expert at Oxford University, assessed that Paris is on the right track. However, there are increased costs that France still has to pay out of pocket. Security and personnel costs may be higher. At the Paris Olympics, the final cost also depends on bonuses for metro drivers, police, medical staff and general security during the event. France has deployed 45,000 police and soldiers, along with 50,000 private contractors to protect the Olympics in the Paris area.

Triathletes swimming, cycling and running also compete right on the Seine River (Photo: MSN).

Bruno Cavalier, chief economist at financial services firm Oddo BHF, said the government's direct involvement was still relatively limited, so the event would not have a major impact on France's current $3.2 trillion public debt. In addition, the cost of cleaning the Seine River to make it suitable for swimming events is about $1.5 billion, and the $3.8 billion expansion of Metro Line 14 is not part of the Olympics budget. The CEO of the Paris 2024 Olympic Organizing Committee is confident that the Paris 2024 Olympic Organizing Committee will not spend more than it can earn and hopes that its strategy will set a new standard for future Olympic models.

How does the French economy benefit from the Olympics?

Hosting major sporting events like the Olympics always brings economic benefits to the host country. In February, consultancy Asteres estimated that the Olympics would bring France $5.7 billion in tax and other revenues. France has so far spent about $3.26 billion on the Paris Olympics, equivalent to 0.1% of the country's GDP. Meanwhile, the International Olympic Committee, which receives money from major sponsorship deals and broadcasting rights, is contributing $1.31 billion. Paris also earns revenue from ticket sales, licensing and domestic sponsorship. The government can claim unexpected short-term taxes during the event from hotels and other tourist spending. The Center for Sports Law and Economics (CDES) estimates that the event could bring in $7.2 billion to $12 billion for Paris and surrounding cities. However, they also stressed that this is an economic benefit spread over about 20 years, starting from when Olympic preparations began in 2018.

The Olympic symbol is located at the Louvre Museum in Paris (Photo: Reuters).

However, experts also say that it is very difficult to accurately measure the impact of major events such as the Olympics. On the one hand, this event increases the number of jobs, attracts foreign tourists and promotes many commercial activities such as ticket sales, use of food services, shopping... On the other hand, the Olympics can still dampen tourism, as airfares and hotel prices increase. Consumption will also decrease if many people choose to stay home to watch live TV. Mr. John Grant, an analyst at the global travel data company OAG, said it is a common misconception that host cities often attract a huge number of tourists to visit during the Olympics. Meanwhile, in reality, many people are afraid to visit the host city during that period. Many hotel chains in Paris have complained that the number of foreign tourists coming here has decreased in the past few weeks, due to both the Olympics and bad weather. France's flagship airline, Air France-KLM, warned earlier this month that the Olympics could cost it $194 million in revenue as international travelers avoid Paris. Delta Air Lines forecasts it could lose up to $100 million in revenue due to a sharp drop in tourism to France. "Unless it's the Olympics, people won't come to Paris," Ed Bastian, chief executive of Delta Air Lines, told CNBC. In a June study, Deutsche Bank said that host countries of the Olympics or FIFA World Cup rarely make a profit from these events, due to the huge investment in building new stadiums and infrastructure. The independent economic research organization French Economic Observatory recently said that France's GDP will only increase slightly in the third quarter, at a rate of 0.3%. The French National Statistics Institute earlier this month forecast that France's economic growth rate this quarter will be 0.3% higher thanks to tourism, ticket sales and broadcasting rights. Accordingly, France's GDP could increase by 0.5% in the third quarter and by 1.1% for the whole year. For the Governor of the French Central Bank, Francois Villeroy de Galhau, the Paris Olympics have a more spiritual impact than an economic one. However, he believes that France can improve its national image through the Olympics, thereby attracting new investments from outside.

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