Finally, the Olympics have arrived again, but they are slightly different. After a year of waiting, the event, which should have been flooding with millions of spectators, has been forced to ban all viewers. The circumstances of the 2020 Tokyo Olympics have had a great effect on Japan's economy.
The original budget that was set for the Olympics numbered around $7.4 billion USD, but it quickly rose up to $15.4 billion. However, reports by Japanese officials have indicated that the cost has risen past $20 billion.
Delaying the games meant that facilities needed to be maintained throughout the year. This costed $2.8 billion to Tokyo's government, a majority of which was paid for with public funding. That funding could have been put towards programs and plans to help the people in Tokyo.
Perhaps the biggest change to the Olympics this year is the ban on most spectators. Not only did a key component of the games get removed, but Japan also lost a key source of income.
If in-person spectators were allowed to watch the games, they would have needed to stay in Tokyo for some time. This meant that they would need to spend money on food, shelter, and transportation. All of this spending would have been beneficial for Japan's economy.
Most importantly, Japan has also lost a huge amount of ticket revenue. Ticket sales which originally were going make around $1 billion have now dwindled down to a couple million dollars since there are basically no spectators. With its main source of cash flow gone, Tokyo's main way to make some money off of the games is through TV broadcasts and sponsorships.
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- Geoffrey