Tokyo Olympics 2020: Cancellation will cost Japan $16 billion

There is a lot of uncertainty surrounding the Tokyo Olympics as Japan is ravaged by the second wave of the pandemic. In case the event doesn’t go ahead, the Japanese government along with all the entities associated with the organization of the Tokyo 2020 Summer Olympics are likely to lose out on an enormous 1.8 trillion yen ($16 billion).

The alarming figures emerged out after a study by Japan-based Nomura Research Institute. They also warned about an even greater financial drain if a new state of emergency is declared in order to cope up with a fresh surge in coronavirus cases after the Tokyo Olympics and Paralympics take place as scheduled, which will act as a super spreader event.

“If the (Olympic Games) trigger the spread of infections and necessitates another emergency declaration, then the economic loss would be much greater,” said Takahide Kiuchi, executive economist at Nomura Research Institute (h/t Reuters).  He also mentioned an estimated loss of 6.4 trillion yen during the first nationwide state of emergency last year. He also said that the cancellation will lead to a loss tantamount to a third of the nominal GDP of 2020.

As per the institution, if the Tokyo Olympics are held from late July without spectators, it would earn Japan 1.66 trillion yen, whereas the inclusion of domestic spectators would add some 146.8 billion yen. Although the organizers ensure to maintain strict safety measures, polls reflect the majority of the Japanese public’s resentment with plans and want the big event to be cancelled.

Japan has been hit with the second wave of the pandemic, especially in the populous areas of Osaka and Tokyo. Although the process of inoculation in the country has been fast-paced, it still lags behind advanced countries like the US and UK.

Talking of vaccines, the organizers are moving ahead with hope with the preparations of the Games despite the uncertainty of them being held. The vaccination drive for the participants, which will begin from June 1, will cover around 600 athletes and 1000 staffers who will be in close contact with them. International Olympic Association remains adamant that games are scheduled to go ahead.

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