Tokyo 2020 Olympic Organizing Committee Decides to Hold Games Without Overseas Spectators... Official Announcement on the 25th

Ticket Revenue Expected to Decrease by Over 10 Billion Yen
Government Financial Burden if Olympics Result in Deficit

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Hyunwoo Lee] The Tokyo Olympic Organizing Committee is reportedly set to hold the Tokyo Olympics without overseas spectators. As a result, ticket revenue is expected to decrease by about 10 billion yen (approximately 105 billion KRW), raising concerns that the Olympics will run at a deficit and increase the financial burden on the Japanese government.

On the 10th, Nihon Keizai Shimbun (Nikkei) reported that the Tokyo Olympic Organizing Committee has decided not to accommodate overseas general spectators and plans to formally approve and announce this decision on the 25th. According to Nikkei, the committee decided not to allow overseas spectators based on the principle of prioritizing the safe hosting of the event and the safety of the public.

Accordingly, ticket revenue from overseas sales for the Tokyo Olympics is expected to disappear immediately. In the budget plan announced by the organizing committee in December last year, ticket sales revenue for the Tokyo Olympics was estimated at about 90 billion yen, accounting for 12% of the total revenue generated by hosting the Olympics. Considering that the proportion of overseas ticket sales during the Olympics usually ranges from about 10% to 20%, Nikkei reported that ticket sales revenue could decrease by 10 billion to 15 billion yen.

As the likelihood of the Tokyo Olympics running at a deficit increases, concerns about the government's financial burden are also rising. According to the Tokyo Organizing Committee, if the Olympics end in a deficit, Tokyo Prefecture will bear the loss first according to the contract between the International Olympic Committee (IOC) and the host city. If Tokyo cannot cover the deficit, the central government will compensate for it. Depending on the extent of domestic spectator restrictions in April, the deficit of the Tokyo Olympics could increase further.

However, Nikkei reported that the International Olympic Committee (IOC) is demanding that Olympic committees and sponsors from each country be allowed to attend, so negotiations are expected to continue. Initially, the Japanese government planned to accommodate about one million overseas spectators at the Tokyo Olympics as a stepping stone to recover the number of foreign visitors to Japan, which had declined due to COVID-19.

This content was produced with the assistance of AI translation services.