Socio-Economic Impacts of Beijing 2008
A critical analysis of the potential impact and implications the 2008 Olympics will have on the socio-economic challenges the Chinese leadership face in the twenty-first century
Term Paper 2007 19 Pages
Table of contents
1. Economic Impacts
1.4 Effects for Beijing and its Region
1.5 Know-How and Foreign Investment
2. Social Implications
2.2 Human Rights
2.3 National Feeling
Answer to Question
A critical analysis of the potential impact and implications the 2008 Olympics will have on the socio-economic challenges the Chinese leadership face in the twenty-first century.
The next Olympic Games in Beijing 2008 are a major interest of the Chinese leadership. By 2008, China aims to have spent $35 billion on the games (“Beijing’s Olympic”, 2007), dwarfing the $8.7 billion spent by Greece. The Economist (2007) has calculated that this amount makes up more than 43 percent of the total for all the games, including Beijing, since Montreal’s in 1976. The summer Olympics shall crown 30 years of successful economic reform. They will symbolize the outside world that China is on its way to reach world power status. The symbolic character to hold the world’s biggest event seems to overshadow other impacts such an event can have (Owen, 2005). But, Uu Jingmin, vice chairman of the Beijing 2008 organizing committee, believes that the Olympics will contribute not only to economic development, it will bring also social progress for the whole country (in Hua, 2004). The Organization committee has proclaimed three major topics: the People's Olympics, the High-Tech Olympics, and the Green Olympics (Hua, 2004). But, it is highly controversial, if mega events are at the end economically and social beneficial for a venue city or not. The output of Olympic Games is “incalculable, or, if calculable best considered as estimates only” (Hiller, 1998). At some points, the Olympics in Beijing can even lead to economic or social damage. To draw a conclusion about the whole range of impacts of global sports-events is difficult because of a lack of available data. Furthermore, China as a whole is still a developing country and faces massive socio-economic challenges. The impact of the Olympic Games will be small in regard to China’s general socio-economic challenges facing Chinese leadership in the twenty-first century. A final conclusion, how useful the Olympic Games will be outside the arena, especially in the long term, can be only drawn, when the games are already over. Anyway, this work shall clarify which impacts the Olympic Summer Games can have on China’s social and economic challenges. Therefore, I split the essay in two parts. The first part will deal with economic impacts and implications resulting from Beijing’s successful bid for the Summer Games. The second part describes social aspects of the Summer Olympics in Beijing. I try to describe not only the impacts on the challenges for China. The Chinese capital as venue deserved attention as well.
1. Economic Impacts
Mega-events are conceived as essentially economic initiatives. Hill (1992) states that "the Olympics is no longer just a sporting event but is closely related to economic objectives not only for host countries but for the corporate sponsors.” And sponsors are willing to pay huge amounts for partner contracts. Ten international companies can call themselves official Olympic sponsors, whereas thirteen Chinese enterprises have achieved a major commercial contract with the International Olympic Committee (IOC). Direct revenues for Beijing from “TOP sponsorship” and local sponsoring are estimated at $130 million each (Preuss, 2004). For many Chinese companies are the Olympic Games a first opportunity to present them to the world market. Chinese almost unknown companies can reach international publicity and can maybe try, after Beijing 2008, to take the step into the global market. But, the engagement will also strengthen the position of companies on the Chinese market. “Some 53 percent of Chinese surveyed said they’d be more likely to buy a product from a sponsor of the Olympics” (“Greatest Show”, 2007).
However, if the 2008 Summer Games will have an impact for long term economic benefits can be questioned. The experiences of Sidney 2000 illustrate that “the scale of the organisation, facilities and infrastructure required for such a huge undertaking are such that the Games cannot but have substantial economic effects” (Owen, 2005). Furthermore, Matheson and Baade (2003) argue, that the prospects of an Olympic event are even worse for developing countries. The provision of state of the art facilities is more expensive and requires maybe international experience. Moreover, infrastructural costs can be very high because of a lack of existence in many areas. In their study about the Olympic Games in Los Angeles and Atlanta Coates and Humphreys (2003) concluded “building new sports facilities and attracting new professional sports teams did not raise income per capita or total employment in any US city.” However, the biggest event worldwide offers many opportunities which can contribute China’s immense economic and social challenges in a long term. As Owen (2005) points it out, “the potential for long term economic benefits from the Beijing Games will depend critically on how well Olympics related investments in venues and infrastructure can be incorporated into the overall economy in the years following the Games.”
The continual economic growth since the beginning eighties has brought an enormous boom for the Chinese construction industry. With the building of prestigious venues domestic companies can proof their ability of first-class construction. The massive infrastructural investments will definitely contribute to Beijing’s attractiveness. “Across Beijing. a hyperactive fleet of bulldozers and cranes is working round the clock to turn China's ancient capital into modern Asia's showcase city” (Hua, 2004). Beijing has 10.000 construction sites at the time (“Greatest Show”, 2007) and is spending $22.8 billion on Olympic-related infrastructure (Hua, 2004). But, infrastructural projects are not limited merely on the Olympic Games. The airport is getting a $2 billion Renovation and the road networks get revised. The Chinese government is spending almost $11 billion on transportation improvements (Guo, 2001). This combines the largest part of investment directly for the event. Furthermore, Beijing’s leaders have announced that the cit spends more than $21 billion upgrading municipal facilities and improving environment in advance of the Olympics (Guo). This includes Beijing’s plan to invest $3.61 billion to improve information infrastructure such as e-administration, e- business and Internet-based communication possibilities.
However, Beijing’s rapid population growth have urban planner not given much time to develop a pleasant environment. The continual moving in of Chinese mainly from rural areas in the search for job opportunities face Beijing with enormous infrastructural challenges. In an infrastructural perspective, the Games must be beneficial. They will embellish the city and will have a sustainable effect for the time after 2008. Beijing’s inhabitants will enjoy a new quality of life through new greens and events in former Olympic venues, if they can be used often. The question of the flexibility of the venue’s architecture is a decisive one. Especially venues for Olympic Games can rarely be managed profitably. Operating costs of sports-buildings are high and most of the sports venues won’t be used very often after the games, if the buildings are not multifunctional. “The degree to which capital infrastructure investments are worthwhile depends on how useful they can be after the Games” (Owen, 2005).