SYDNEY has had little to cheer about over the past few years. The effects of the recession were everywhere - empty shops for lease, commercial space being offered free of rent for a year, and closing down sales were on almost every street corner. The announcement last September that Sydney would host the 2000 Olympics has turned the bust into a boom in Sydney. The stockmarket has soared in recent weeks, property prices are picking up and there is a general sense of relief the recession is finally over. Wandering around the historic streets of Sydney's 200-year-old Rocks area, it is becoming difficult to find traces of the recession that, in the words of Prime Minister Paul Keating, ''Australia had to have''. Busy flea markets spill out on to the streets and shoppers come from all over Sydney to take in the sights and pick up a bargain or two. ''It was like the rain that broke the drought,'' said one resident on the effect of the Olympics on Sydney's recession. Talking to people one senses a renewed sense of optimism. Reaction to winning the games has been universally positive. Mr Keating described the win as ''a defining decision that marks out the Australian nation as one that can carry the greatest international pageant of our time. ''We are there as a country in our own right, right on the brink of a new millennium, right on the centenary of our Federation.'' The Premier of New South Wales, John Fahey said at the time of the win: ''Fantastic. Fantastic. Fantastic. My heart is in my mouth.'' Reaction to the news that Sydney had won the Olympics from Sydney residents was equally strong. ''The night I heard we won the Olympics is one I'll never forget,'' said one Sydneysider. ''We were all waiting outside the Opera House for the announcement. ''When they read out Sydney as the winner we went wild. All next day there were parties in the street, car horns blasted, and we got ready to go out partying again.'' Indeed, the party has not stopped. Never mind the reported Olympic budget blowout of about A$1 billion (about HK$5.4 billion), or the fact that the staging of the Olympics will leave Sydney with a huge debt which will take years to pay off. As far as most Sydneysiders are concerned, the Olympics will provide a much needed kick start to the economy. The New South Wales Government believes the games will inject about $7.3 billion into the economy, add about 160,000 full-and part-time jobs, and boost tourism by about 1.4 million visitors over the next seven years. And as the reality of hosting the Olympics sets in, people are starting to focus on the games themselves. Sydneysiders are hoping that holding the Olympics in their own town will give Australian athletes an advantage in the games. ''There is no doubt the home advantage will be a big boost,'' said Kieren Perkins, a gold medallist for Australia at the Barcelona Olympics. ''Every athlete in Australia will be working harder towards the year 2000,'' he said. The much-needed confidence boost to the city and its people is already showing itself through record January retail sales. The major department stores in Sydney catered to record numbers of shoppers in the traditional post-Christmas sales. One store manager said: ''This year not only are we having more shoppers coming through our stores than last year, but they are spending more too.''