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The Beijing Summer Olympics will undoubtedly be a success — but at what cost?
Wu Chen, CFO Magazine
October 1, 2007
Exactly one year before the start of the Beijing Summer Olympics, which begin on the auspicious date of August 8, 2008 (the Chinese regard eight as a lucky number, and a triple eight compounds its value), state media is dominated by reports of how excited the Chinese people are about hosting this most important of sports events. Despite concerns about air pollution and traffic jams, China is taking undeniable pride in its "coming out" party, and Beijing is determined to make it a success. But at — literally — what cost?
In an open letter to the country's top leadership, dated August 7, a group of prominent Chinese dissidents called on the government to honor its commitment to the Olympic spirit. Among other things, they implored the government to "make itself a model citizen in fighting corruption in sports and organize an open and transparent Olympics, by (1) providing thorough, systematic supervision of the use of Olympic funds; (2) revealing to Chinese taxpayers the true cost of construction projects for the Olympics; and (3) making public the project bidding process and the use of funds raised."
These dissidents have every reason to raise concerns about the true cost of organizing the Olympics, and their calls for transparency are in line with the tenets of the "harmonious society" espoused by President Hu Jintao. A year ago, the vice mayor of Beijing in charge of the construction of Olympic stadiums was fired because of corruption charges. Three years ago, the State Sports Bureau, which is responsible for training athletes and building sports arenas, was found guilty of improperly appropriating $16 million worth of Olympic funds to build apartments for athletes.
Corruption aside, Beijing has been close-mouthed about the cost of the Olympics. According to one Beijing scholar, the estimate of overall cost, including infrastructure projects, could reach $67 billion. However, the true cost appears to be a taboo subject in Beijing. (CFO China's request to interview the organizers of the Olympics was turned down, due to the "sensitive nature" of the subject.)
China has a long history of using megaprojects to demonstrate its power, the Three-Gorges Dam being the most recent example. There were numerous reports about the misuse of relocation subsidies for hundreds of thousands of people forced to leave their homeland to make room for that construction, and the budget almost tripled. The Beijing Olympics may be no exception, and indeed recent Olympics have all suffered from cost overruns and unanticipated delays. Among the consistent calls by the foreign press for transparency and freedom of coverage, one message should be loud and clear: open your books and demonstrate that China is both deserving of global recognition for its accomplishments and mature enough to withstand global scrutiny.
Wu Chen is editorial director of CFO China.