(eTN) – For the past five years, Greece has been in an economic recession. As a result, Greece will be recorded in history as a country that has had one of the worst economies during the modern times. That much is certain. What isn’t certain and perhaps open for debate is how the country got there. Some would argue that the fault rests on the Greek government’s inability to collect tax from its citizens. Some lay the blame on a single event to have served as the catalyst for Greece’s economic demise – the 2004 Athens Olympics.
The 2004 Athens Olympics was not the rousing success that it sought to accomplish, because the projected cost for the event and the final bill differed so greatly, resulting in a worst-case scenario – the cost was underestimated and the economic benefits were overestimated.
In Greece’s defense, it could not have predicted that hosting the event would help set the country’s financial collapse. On the contrary, Greece was probably hoping that the Olympic Games would be the catalyst for the country’s much-needed financial reforms. Budgetary constraints led to anticipated problems like construction delays and changes, but having to modify the security budget to accommodate the war on terror was not. The events of September 11, 2001 compelled Greece to beef up its security budget from an undisclosed figure to 970 million euro.
Greece estimated it would spend 4.5 billion euro for the event, but ended up footing for a complicated bill whose value remains a subject of contention to this day. According to the Greek embassy, Athens spent 8.594 billion euro on hosting the 2004 Olympics, “not including the cost of projects that were completed or the construction of which were accelerated due to the Games, but which had been planned for construction regardless of the Games. Those projects included the Attiki Road highway, Athens’ new Eleftherios Venizelos international airport, the tram, and the suburban railway. Of that 8.954 billion euro total, an estimated 7.202 billion was footed by Greece, with the remaining 1.752 billion euro coming from the Athens 2004 Organizing Committee (ATHOC) and financed by the committee’s revenues from ticket sales, television broadcast rights, Olympic-logo product sales, and sponsorships.”
Not true, says BBC, which reported in June 2004 that the cost of the Athens 2004 Olympics Games is close to 10 billion euros, which obviously is not consistent with the Greek embassy’s figure. Regardless, the outcome remains the same — Greece ended up paying for an event it could not afford. It became evident, however, that the hope for the Olympic Games to bring positive financial returns became secondary to delivering on its promise of a Summer Olympic Games based on humility and earnestness. As the country that gave birth to the Olympic Games, the theme could not have been better conceptualized. Unfortunately, by the opening ceremony of the 2004 Olympic Games, held on August 13, Greece was buried in debt and the worst, as we know now, was yet to come.
As the 2012 London Olympics draws near, the issue of cost and benefit is worth raising from a travel and tourism standpoint. Check out eTN’s exclusive edition on Monday, February 19, 2012, for an in-depth look on the subject.
