Tokyo 2020 forced to cut budget

Bengaluru, December 22: Organisers of Tokyo 2020 Olympics unveiled a major cut in their budget for hosting the quadrennial extravaganza, as the city comes under pressure to keep a lid on spiralling costs.

The overall games budget now stands at a total of 1.35 trillion yen ($12.6 billion).

This represented a cut of $1.4 billion compared to the previous version of the budget unveiled last December and $0.3 billion compared to an interim figure agreed in May.

Tokyo organisers were under pressure to keep costs down, with the International Olympic Committee (IOC) worried that ballooning price tags for hosting the games will deter cities from bidding for the showcase event.

In its bid, Tokyo estimated the bill for the Games at a little over $7 billion.

"Going forward, Tokyo 2020 will continue to seek further cost reductions, particularly in the areas of event operations, transport, accommodation and security," organisers said.

They hailed a "significant reduction in costs" resulting from "sustained efforts ... to avoid recourse to public funds."

"This will not be the end of the cost reduction efforts," said Tokyo 2020 chief financial officer Hidemasa Nakamura.

The IOC's Games co-ordination commission chairman John Coates said in October Tokyo should aim to cut overall costs by $1 billion from the interim figure.

"We hope to draft (budget) plans so that Coates will say 'good job' at the end," Nakamura said.

The Tokyo 2020 organising committee will cover $5.6 billion of the costs, with the Tokyo city authorities and the Japanese government stumping up a further $7.0 billion between them.

The $5.6 billion organising committee budget is covered by ticket sales, licensing and sponsorship and the statement hailed an increase of $0.9 billion in sponsorship revenue.

However, Tokyo 2020 admitted it still needed to find $0.2 billion in "expected additional revenue" to balance the books and vowed it would "continue to look at ways" to secure the extra funding.

(With Agency inputs).