Games bid estimates loss of HK$13.8b

Hong Kong could make a financial loss of about HK$13.8 billion if its bid to host the 2023 Asian Games succeeds, calculations from a government consultation document released yesterday show. The document estimates total capital and operating costs of HK$13.7 billion to HK$14.5 billion at current prices and revenue of HK$700 million to HK$860 million from ticket sales, merchandising and sponsorship. The estimates exclude the HK$30.17 billion construction cost of eight new venues, as the government said they were in the pipeline whether the city hosted the Games or not. They also do not take into account expected economic benefits of HK$400 million to HK$600 million from up to 69,000 tourists and the creation of up to 11,170 jobs. The cost estimate for the city's second bid for the Games - a bid for the 2006 event, lodged in 2000, lost to Doha - includes HK$10.5 billion in capital spending on upgrading sports venues and operating costs ranging from HK$3.2 billion to HK$4 billion. The planned new venues include the nearly HK$20 billion Kai Tak multipurpose stadium complex, five sports centres, a sports ground and a redeveloped tennis centre, which are set to be completed by 2023. The cost of building a 3,000-flat athletes' village is also excluded as the government has yet to decide if local developers or government-linked organisations will build them. Secretary for Home Affairs Tsang Tak-sing described pouring billions into the Games as an investment that would boost the city's sports development, social cohesion and international status. 'Drawing experience from [last year's] East Asian Games, we will continue to adhere to the people-based principle and take into account the interests of the whole community. We will not bring in extravagant infrastructure that creates no long-term benefits,' Tsang said. 'The East Asian Games has not created any 'white elephant' facilities and organising the Asian Games will not produce any either.' Tsang and Asian Games Bid Team head Eddy Chan Yuk-tak said that despite the huge expenditure involved, there were many tangible and intangible benefits that would be brought to Hong Kong by the Games. Tsang said bidding for the Games was 'an opportunity not to be missed', and the government would listen to public opinion during the six-week consultation up to November 3. It would then decide by the end of January whether to file a formal bid to the Olympic Council of Asia. Kuala Lumpur, Hanoi, Taipei, Dubai and New Delhi were possible rivals for the Games, a government official said. Based on population projections, Hong Kong would need 19 more sports venues to meet demand by 2020, meaning it would have to build new venues in any case, the official said. Members of the Legislative Council's home affairs panel indicated some reservations about the Games and criticised the government for not providing a detailed budget. 'You are pushing us to decide and the consultation only lasts for a few weeks,' unionist legislator Wong Kwok-hing said, adding that although he supported the plan, the city had to consider if it had the capability to host the event. Democrat Kam Nai-wai questioned the estimates. 'Will we underestimate the spending? Have we calculated the cost of building the transport facilities we will need?' He also wondered whether allowance had been made for rising costs, pointing to the increase in the cost of the high-speed Hong Kong-Guangzhou railway from HK$30 billion to more than HK$60 billion. The Civic Party's Tanya Chan called on the government to unveil more financial details. She said the government should tell the public if the sports facilities for ordinary residents would be affected if the application failed. 'What I really fear is that hosting the event will be like burning money for fireworks,' she said. But the proposal won stronger support from sports circles. Football Association chairman Brian Leung Hung-tak said the bid would provide more facilities for the sport, adding that Hong Kong could never have won last year's East Asian Games soccer gold medal if the event had not been held in Hong Kong. Timothy Fok Tsun-ting, president of the Sports Federation and Olympic Committee of Hong Kong, said holding the Asian Games would not only improve local athletes' standards, but also the public's interest in sport. Hong Kong proposes featuring 35 sports in the 2023 Games - including seven non-Olympic sports such as bowling, cricket, wushu and squash - and expects to draw 11,000 athletes. In its earlier bid, the government estimated hosting the 2006 Games would incur a loss of HK$730.5 million. Doha spent HK$21.7 billion on its Games, while Guangzhou has invested an estimated 200 billion yuan (HK$230 billion) on the next Games, which will take place in November.