Economic stimulating effect for the next 7 years until Tokyo Olympic will be 7 to 12 trillion yen and it will create employment for 400 to 700 thousand.
Many are anticipating economical benefits to the tourism industry and such since Tokyo was selected as the host of the 2020 Summer Olympic Games. A recent analysis by the Japan Research Institute on the economic effects of the Tokyo Olympic Games expects, 3.9320~6.6320 trillion yen increase in demand, 6.7780~11.7780 trillion yen for the production inducement amount and employment inducement for 3,970~6,750 thousand people. Looking at the production inducement amount, it is equivalent to about 2% of the GDP which would be similar effects to those of London Olympic Games.
▼3.9320~6.6320 trillion yen increase in demand during the preliminary period
As it was in London, visitors from overseas are assumed to increase during the preliminary period of the Olympics, so the proportion of corporate investment to the gross product of the Metropolitan Tokyo is assumed to rise to the same level as it was before the Lehman's fall, and this leads to the estimation of 3.9320~6.6320 trillion yen increase in demand. The amount of demand increase breakdowns to: 680 billion yen by the increase of the tourists from overseas because Tokyo will gain more recognition and 2.2000~4.900 trillion yen for construction demand for redevelopment of the area and also for tourists targeted accommodations and restaurants.
▼580 billion yen increase in demand during the Olympic
During the Olympic Games, 580 billion yen increase in demand is being estimated. This, calculating total spending of Olympic spectators/visitors, is according to the preliminary calculation made by the Department for Culture, Media and Sport, UK for the London Olympic. Within the 580 billion, Spectators are expected to spend 270 billion yen for .lodging, food and drinks, related goods and souvenirs. Tokyo Metropolitan Government, incidentally, assumes maximum of 920 thousand spectators a day will visit the Olympic sites. Total of 15.640 million spectators during the 17 days of Olympic Games, thus over 10.000 million spectators are perceived to visit Tokyo.
▼Not only positive but also negative “Olympic effects”
However, both positive and negative effects are predicted after the Olympic. With more recognition, more international tourists will visit Tokyo and improvement of the city function by redevelopment will push up growth potential. But at the same time, investments in construction will settle down and be decreased or held down in economic activity due to increased debts. In order to maximize the positive effects and minimize negative effects, net public spending should not interfere with financial reconstruction and kept to a minimum, making the Olympic as an opportunity for Tokyo to elevate to a more “internationalized city” and city redevelopment suited to declining/aging of population which will advance in Tokyo after 2020 are listed as essential key points.
