“I am not pessimistic for the Olympic Games," says IOC President Jacques Rogge.(Getty)
(ATR) The president of the IOC says the global financial crisis will not drag down the Olympics while the U.S. Olympic Committee is ready to take stock of the market turmoil in a board meeting this week.
Late Tuesday the USOC issued a public notice for an unscheduled October 2 meeting of the board, so hastily called the 11-member board will meet by telephone.
“Instability in the global financial markets and the potential impact for the USOC in generating revenue, both short-term and long-term” is how the agenda item is worded. The $600 million raised every four years by the USOC comes entirely from private sources.
"It’s an issue for everyone. Every organization should be taking a look at its operations and determining how it will weather this storm," explains spokesman Darryl Seibel about the prudence being taken by the USOC.
In his speech to a Swiss press club luncheon in Geneva Tuesday, Rogge said the crisis will not hurt the Olympics.
"No one has certainties today, but I am not pessimistic for the Olympic Games," Rogge said.
While his speech was in French, Rogge chose English, the language of global commerce, when it was time to talk about the financial strength of the Olympics and upcoming Games.
He said there is “no issue” over finances for the Vancouver Olympics, for which construction is largely complete.
London does face risk over financing of the Olympic Village. Officials in London acknowledge that the credit crunch has made it unlikely that they will be able to raise the $900 million in private funding once planned for the $2 billion project. But Rogge says he believes that London will find a solution.
"The Olympic construction authority is looking for more funding but the latest report we had is that they would manage in finding the proper funding," he said.
Rogge insisted the development in London’s east will lead to a profitable legacy.
“It is going to recoup itself because it is going to be sold after the games to private citizens and customers, as we have seen in Beijing,” said Rogge.
Understandably sharing Rogge’s optimism is the chair of the IOC Finance Commission, Richard Carrion. The head of Puerto Rico’s largest bank, Carrion tells Around the Rings that with the IOC making TV rights deals years before the Games, market perturbations such as this week’s are not an issue.
“I’m not too worried that the current economic crisis will impact the value of broadcast rights. The 2010-2012 cycle is essentially done and we are starting to look at 2014-2016 rights negotiations. The critical issue is economic conditions in the months leading up to the Games, not now,” he
London is facing issues securing funding for the Olympic Village for the 2012 Games. (Getty)
Of the billions now raised every four years by the IOC, Carrion says the money is well-cared for, including a cash reserve believed to be in the range of $300 million.
“The IOC has good investment policies and they have been tested in this environment and we’re satisfied with the results,” said Carrion.
The USOC gets half of its quadrennial $600 million from its share of IOC revenues and the rest from national level sponsors. Unlike many of the rest of the world’s 205 NOCs, the USOC gets no government funding.
The impact of the financial crisis is one of four agenda items; another is the selection of a successor to chairman Peter Ueberroth, who is due to step down in the next two weeks.
Madrid is alone among the four cities bidding for the 2016 Olympics where there has been some immediate reaction to this week’s events. Mayor Alberto Ruiz Gallardon has ordered a halt to infrastructure spending in the next year as a response to the credit crisis. But the leader of the Madrid bid tells ATR that work needed to deliver an Olympic Games is not affected by the mayor’s decree.
Written by Ed Hula
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