Pyeongchang budget lacks plan for after Games

A stunning 12.8 trillion won, or $12 billion - that is how much the government is set to spend on Pyeongchang to host the 2018 Winter Olympics.

By hosting the world’s biggest winter sporting event, the government hopes to produce 230,000 new jobs and bring in more than 200,000 tourists from overseas to the city of 44,000 during the 17-day international event.

Amid growing expectations for the first Winter Olympic Games hosted by Korea, coming 30 years after the 1988 Summer Olympics in Seoul, concerns have also grown that the city and the central government lack any concrete plans for Pyeongchang following the end of the Games.

According to the 2014 annual budget ratified by the National Assembly on New Year’s Day, 11.08 trillion won is earmarked for the construction of stadiums and facilities for the Games, while 1.76 trillion won will be spent on organizing the Games leading up to 2018.

However, no money has been budgeted for Pyeongchang after the Olympics, putting the city at risk of being yet another host city to suffer the “Olympics curse.” The curse refers to the heavy toll local economies often suffer after hosting the Olympics, such as the economy of Vancouver, Canada, which hosted the 2010 winter games and Nagoya, Japan, following the 1998 Winter Olympics.

“Of the budget earmarked to be spent by 2018, nothing has been earmarked for a long-term development strategy [to recoup the investment],” said an official on the organizing committee, speaking on the condition of anonymity.

“I understand the Gangwon Provincial Government and the Ministry of Culture, Sports and Tourism are responsible for the post-Games plan.”

When asked about the long-term plans, an official at the provincial government office also had no answer, only saying the central government may lead a team in charge of the long-term development.

The Park Geun-hye government on Friday announced a special development plan for Pyeongchang, designating the 27.4-square-kilometer (10.6-square-mile) zone where the Olympics will be held as a special economic zone. The zone is to get a 3.3 trillion won investment, 80 percent coming from private investors and the rest from the government, but it remains to be seen if the plan will entice private businessmen to invest.

“I don’t think any firm will be interested [in investing] given that real estate values have shot up in areas near Pyeongchang [on the back of the Olympic expectations],” said Representative Yeom Dong-yeol of the ruling Saenuri Party, who represents Pyeongchang.

With no budget earmarked for a post-Olympics strategy, no personnel has been designated for the task. A majority of the nearly 300 people on the organizing committee and local governments are tasked with the construction of Olympic stadiums and relevant facilities.

There is also another reason to worry about the post-Olympic curse.

Vancouver, which hosted the last winter Olympics, is estimated to have suffered upward of $10 billion in debt. Japan’s Nagano has spent 2 billion yen, or $19.2 million, in taxpayer money just for maintaining the sports facilities, with no significant income coming from those facilities since the Olympics; instead, the facilities just sit mostly unused.

Meanwhile, to prevent local governments from hosting costly international events that drain the public coffers, Representative Kim Jae-won of the Saenuri said yesterday he would propose a bill that will require local governments to get approval by the National Assembly to bid on events that cost more than 10 billion won.

BY KANG TAE-HWA, KIM KYUNG-HEE [jkkang2@joongang.co.kr]