Greece braces for Olympic-sized bill
Posted: Thursday October 7, 2004 8:29PM; Updated: Thursday October 7, 2004 8:29PM
ATHENS, Greece (AP) -- The heady days of the Athens Games are over. Colorful banners have been pulled down and stadiums built in a rush of last-minute construction lay empty.
Now Greeks are bracing for the Olympic-sized bill.
The Paralympics finished more than a week ago, but Greek officials still are adding up the costs of staging the world's largest sporting event.
"We will announce it shortly. We are now doing the accounting for the Olympics," government spokesman Evangelos Antonaros said. "The Olympics just ended ... and in the immediate future all these unanswered questions will be answered."
So far, though, Athens has not been very good at answering tricky questions about its public finances.
The European Union has put Greece under the fiscal microscope after several revisions of its budget deficit for 2004 took the figure from 1.2 percent of gross domestic product to a whopping 5.3 percent.
Much of the hidden extra spending was blamed on the Olympics.
"It's no secret that several government officials have hinted that the final cost of the Olympic Games will be much higher than what was initially projected," said Platon Monokroussos, an economist with Greece's EFG Eurobank. "Figures as high as $9.9 billion and $12.4 billion have been suggested. We are talking about a serious overrun, since the initial budget was about $5.7 billion."
The government blames the inflated costs on construction delays and unprecedented security.
Athens spent more than $1.5 billion to defend the games against a potential terrorist attack -- about the overall cost of the 2000 Sydney Olympics.
The financial troubles are complicated by the fact that Greece did not get the immediate economic boost from the games that it had been counting on. Security jitters and concerns about overcrowding kept visitors away.
And debt is not the only problem. There's also the question of what to do with more than $3 billion in new or refurbished sports venues -- from baseball fields to beach volleyball arenas.
A University of Thessaly study commissioned by the Greek government predicted it will take $100 million a year for upkeep of the more than a dozen Olympic sites, including the main stadium complex.
"Managing and operating the venues is a great challenge because we know that their maintenance has a high cost," Monokroussos said. "This will obviously require the cooperation of the private sector."
The government has been considering ideas for their use, including future bids to host the European soccer championships and other high-profile sporting competitions.
The only clear plans so far include converting the Olympic athletes' village into apartments for low-income workers, selling some media village space and using a few venues as possible conference and convention sites.
All the Olympic bills have come at a bad time for the Greek economy.
The conservatives who took over in March after 11 years of Socialist rule decided last month to audit the previous government's books. The results were disturbing.
Data showed Greece's 2003 deficit stood at 4.6 percent of GDP, compared to a previously reported 1.7 percent. After the Olympics, Premier Costas Caramanlis said the 2004 budget deficit could hit 5.3 percent -- well above the European Union's 3 percent cap.
"The country is facing an acute financial problem that can no longer be hidden," Caramanlis said.