THE ECONOMICS OF THE OLYMPIC GAMES

The 1984 Olympics in Los Angeles, US were the first games I watched.

That edition was famous for the US Carl Lewis winning four gold medals. It was also the year Kenyan Julius Korir won the steeplechase, starting a string of nine straight golds in the event by our Kenyan neighbours, that lasted until the Tokyo Olympics in 2021.

So last week very much older, I settled in and gleefully arranged my remotes close at hand to enjoy two weeks of the Olympic smorgasbord.

I was not disappointed in week one.

US gymnast Simone Biles cemented her place as the greatest gymnast of all time, leading the US to gold in the team event and winning the women’s all-around event for herself. And at the time of writing she was in the finals of three other events and looking like a sure deal to bag gold in all.

The South Sudan men’s basketball team gave a good account of themselves against the US team, going down 103-86. This match was much anticipated, as only days ago it took a Lebron James three pointer in the final second of the game to squeeze past our northern neighbours 101-100.

We shall not say much about the women’s volleyball event.

But I have since developed an interest in the economics of sport and it was interesting understanding what it took to put these Olympics together.

For starters it is estimated that about €9billion (sh36.3trillion) was spent to make the Games happen, most of which was from private funding.  France did the new and upgraded the infrastructure which accounted for less than a half of the total budget...

The projections are that the economic benefits to the Paris region over the duration of the games and beyond will between €7 and €11billion (upto sh44trillion) due to a boost in tourism, job creation and infrastructure improvements.

There will be 329 gold medals on offer and the 48 Athletics winners will each walk away with $50,000.

For me the beauty of these games is that the private sector is picking up most of the tab. That means that except for a few vanity projects, these monies will be efficiently spent and show a return, with less impact to the public purse than if the government bankrolled the whole event.

The funding of sports in any society is out of the surpluses that economy can generate. The bigger the economy the more they can fund sports.

Governments used to see sports as a way for the  youth to expend energy and not pay attention to politics, but in the last few decades or so the rise of professional sports has shown that sport can be bona fide economic activity, which while making the youth busy can afford them real livelihoods. In a few instances beyond their wildest dreams or if they had taken the traditional white collar career path. Potential gold medalist Carlos Alcaraz has already made about $8million in prize money this year alone.

  And he is only 21.

But these suplurses especially from the private sector, are far from being charitable handouts. The private sector wants to see a return, often in terms of marketing benefits.

In Uganda where our sports administrations are volunteer based, it’s hard for the private sector to pour money into sports, because they cannot see a return on their investment.

Apart from regulatory oversight, sports does not need government to thrive. The US the world’s greatest sporting nation has no sports ministry. And yet they have sent just over 500 athletes to the Olympics.

The US sports associations have become adept at creating sports events, marketing them and selling them to corporate America. Basketball, American football and baseball are now multibillion dollar enterprises. At the Olympics the US is dominant in gymnastics, swimming, track and field.

And after conquering America they are spreading their wings abroad.

Our sports officials – assuming they want the best for their sports, would be wise to take a leaf from the US model of financing sport and its applicability in a country where there are more pressing needs than sports to fund.

So while I ooh and aah at the athletes performance, never mind marveling what it took to get into that demigodesque (see the women volleyballers) shape, a look under the hood at the economics of sport is just as entertaining if not more so, for me.