The Tokyo 2020 organizers Friday unveiled a “significant” cut in the budget for hosting the Olympics as the capital comes under pressure to keep a lid on spiraling costs.
The overall games budget now stands at ¥1.35 trillion ($12.6 billion), the organizers said in a statement. This represents a cut of $1.4 billion from the previous version of the budget unveiled last December, and $0.3 billion compared with an interim figure agreed to in May.
“Going forward, Tokyo 2020 will continue to seek further cost reductions, particularly in the areas of event operations, transport, accommodation and security,” the organizers said in a statement.
They hailed a “significant reduction in costs” resulting from “sustained efforts . . . to avoid recourse to public funds.”
“This will not be the end of the cost reduction efforts,” vowed Hidemasa Nakamura, chief financial officer of the Tokyo 2020 organizing committee, at a news conference.
The chairman of the IOC’s games coordination commission, John Coates, said in October that Tokyo should aim to cut overall costs by $1 billion from the interim figure.
“We hope to draft (budget) plans so that Coates will say ‘good job’ at the end,” Nakamura said.
The Tokyo 2020 organizing committee will cover $5.6 billion of the cost, with the Tokyo municipal and central governments contributing an additional $7.0 billion between them.
The organizing committee’s $5.6 billion budget is covered by ticket sales, licensing and sponsorships. The statement also hailed the $0.9 billion increase in sponsorship revenue.
But the Tokyo 2020 organizers admitted it still needed to find $0.2 billion in “expected additional revenue” to balance the books and vowed it would “continue to look at ways” to secure the extra funding.
Tokyo’s organizers are under pressure to keep costs down because the IOC is worried the ballooning price tag for hosting the games will deter other cities from bidding for the sporting extravaganza.
The rollout of the new National Stadium, the Olympic centerpiece, turned into a fiasco when Prime Minister Shinzo Abe tore up the blueprints amid public anger over its price tag.
In 2016, a panel warned that the total cost could exceed an eye-watering $25 billion.
In its official bid, Tokyo estimated the bill would come to just over $7 billion.