Tsukiji and US$25 Billion — Tokyo 2020 Costs Continue to Rise
The Board of Audit of Japan, Japan’s constitutionally-mandated independent expense-auditing agency, released a report on Oct. 4, 2018, detailing that central government expenditures related to the upcoming 2020 Tokyo Olympics and Paralympics have exceeded 801.1 billion yen (US$7.14 billion). If combined with spending by the local Tokyo Metropolitan Government and the organizing committee, this figure — already more than seven times the initial budget estimates presented by the national government — would balloon to approximately 3 trillion yen (US$26.7 billion), almost three times the initial estimate for the total cost of hosting the Olympics.
The city of Tokyo was selected by the Japanese Olympic Committee as Japan’s representative city to host the 2020 Summer Olympics in July 2011 after Hiroshima and Nagasaki withdrew their joint bid citing outstanding debts dating to the 1994 Asian Games. At the 125th session of the International Olympic Committee (IOC) held in Buenos Aires, Argentina, in September 2013, Tokyo was officially selected by the IOC to be the host city for the 2020 Games, beating out Istanbul and Madrid and bringing the Games back to Tokyo since its last time as a host city for the 1964 Summer Olympics.
While the central and local governments cited the Olympics as a prime opportunity to demonstrate Japan’s recovery from the 2011 earthquake and tsunami to the world and bring in much-needed economic activity for the region and country as a whole, preparation efforts were almost immediately embroiled in a series of scandals ranging from suspicious money payments for “consultants” to the resignation of two successive governors of Tokyo Metropolis over allegations of financial misconduct. In the two most notable public episodes of controversy, the Japanese government scrapped the original design for the central stadium in July 2015 after estimated construction costs soared by over 100% while the Tokyo 2020 organizing committee was forced to pick new mascot designs for the Games in April 2016 after severe allegations of plagiarism arose over the previous designs.
By the end of 2016, the Tokyo Metropolitan Government issued a report estimating the total cost for hosting the Games would exceed 3.4 trillion yen (US$30 billion) unless marked cost-cutting efforts were undertaken. Cost overruns and the litany of setbacks forced local and central governments to issue statements denying any unpreparedness for the 2020 Games and asserting that all preparations were “going as planned.”
The Oct. 4, 2018, report by the Board of Audit does not come as a surprise; in January of this year, the Tokyo Metropolitan Government announced that it would allocate an extra 810 billion yen (US$7.22 billion) to fund “related expenses” for the Games, thus totaling costs to roughly 2.16 trillion yen (US$19.2 billion). Among other things (including the ballooning cost figure), the Board of Audit found that some projects listed as part of the preparations for the Games appeared to have little relation with the Games; that no clear refurbishment plan exists for newly-constructed Olympic facilities after the Games are over; and that the Tokyo Metropolitan Government had fallen into arrears regarding 39.5 billion yen (US$352 million) in payments it still owed.
The organizing committee and certain government officials have contested the 801.1 billion yen (US$7.14 billion) figure, claiming that the Board of Audit included costs and programs that either were not directly related to the Games or would have been implemented regardless of the Games. Additionally, the organizing committee reported to the IOC on Oct. 9 about further cost-saving measures in line with the IOC’s “Agenda 2020” and “New Norm” initiatives — initiatives that seek to drive down the cost of hosting future Olympics — and reported an overall budget of 1.41 trillion yen (US$12.6 billion). The organizing committee is slated to present a new budget in December of this year; however, major media outlets have already begun to voice concern over the “soaring Tokyo Olympics costs” and questionable appropriation practices.
Apart from monetary controversies, preparation efforts for the 2020 Games have also drawn protest from Tokyo residents over the lack of consultation, most notably regarding the relocation of Tokyo’s Tsukiji fish market, the world’s largest wholesale seafood market in the world. While plans to move the market out of its aging facilities in Tsukiji to a new site in Toyosu were considered under then-Governor Shintaro Ishihara in 2009, the Tokyo Metropolitan Government redoubled its efforts to relocate wholesalers in 2014 citing the need to redevelop the land in Tsukiji — prime real estate in Tokyo’s Chuo Ward — in preparation for the 2020 Games.
However, relocation efforts were temporarily suspended in August 2016 by Governor Yuriko Koike owing to lingering concerns over toxins in the soil of the designated site in Toyosu, which used to host a gas production plant. Furthermore, the Tokyo Metropolitan Government had already spent 85.8 billion yen (US$764.6 million) in 2011 through 2014 to decontaminate the site and faced a total bill of 588 billion yen (US$5.24 billion) for construction costs.
Koike ultimately approved the move to Toyosu in August 2017, although critics noted that the decision approving the move and a new redevelopment plan for Tsukiji were made after consultations behind closed doors without documentation. Efforts to contest the relocation via litigation and protests proved unsuccessful; Tsukiji held its final auction on Oct. 6, 2018, and closed down while the new market at Toyosu opened on Oct. 11 after concerted efforts to relocate all wholesalers were completed amid some confusion.
The apparent end of the Tsukiji saga and the continued acrimony over the monetary cost of hosting the Olympics is of prime concern to not only Tokyo or Nagatacho but also to the IOC and future Olympic Games hosts. After Tokyo, the next Olympic Games with confirmed hosts are Beijing (2022 Winter Olympics), Paris (2024 Summer Olympics), and Los Angeles (2028 Summer Olympics). Should the Bureau of Audit’s estimated expense numbers hold, Tokyo 2020 will become the third-most expensive Olympic games in modern history. This precipitous rise in costs and increasingly unsympathetic political attitudes in host cities may pose an existential threat to future Olympic Games — a fact highlighted by the wavering number of cities bidding for the 2026 Winter Olympics.