Скачать или смотреть Tokyo 2020 Japan debt $25 Billion ( Is really hosting olympics is worthful for Japan)?

Tokyo Olympics costs hit $25B
Japan’s Debt Crisis

1. The price tag keeps soaring for the 2020 Tokyo Olympics. It is estimated that now Tokyo 2020 olympics may cost 25 billion US dollars.
This is nearly a fourfold increase over Tokyo’s winning bid in 2013.
2. Tracking Tokyo olympic costs is getting more difficult as work speeds up, Deadlines near, and disputes arise about what are — and what are not — Olympic expenses. Complicated accounting also makes it difficult to figure out who pays for what, and who profits.
3. About 80 percent of the $25 billion will be taxpayer money. The rest — about $5.3 billion — comes from the privately funded operating budget. This budget receives $1.7 billion from the IOC with the rest coming from sponsors, merchandising and ticket sales.
4. The IOC and the Japanese organisation committee, which is led by former prime minister Yoshiro Mori, disagree with the meaning of ‘Olympic spending’. They believe that external schemes such as tourism and volunteer-training should not count as costs directly related to the Games, arguing that they are “regular administrative costs.”
5. A long-delayed increase in Japan's consumption tax will now go into effect in October 2019, as affirmed by Japanese Prime Minister Shinzo Abe. Abe remarked that the planned increase — from 8% to 10% — would not be affected by economic conditions between now and October of next year.
6. But there’s a real safety concern for Japan’s fiscal stability. And though the economic stimulus that comes with hosting an Olympic Games could be positive, game preparations are also highly likely to increase Japan’s already massive debt problems.
7. That includes the construction of 11 new sporting venues and 10 temporary ones, at a cost of $3 billion. The Olympic village will cost another $1 billion, according to the IOC.
8. However, The Tokyo government projects that the Games will generate $30 billion in economic benefits for Japan.
9. What Abe’s probably banking on is that spending might shrink the 230% GDP debt. But that’s a gutsy gamble for a country approaching unsustainable levels of interest payments due on its debt. And it’s not just Japan that’s affected by these choices. If Japan’s debt problems end in default—or avoiding a default spurs hyperinflation—the resulting banking crisis and economic collapse will likely damage the global economy. As they say—it’s all fun and Games until someone gets hurt.
10. First off, let’s have a look at how Japan got trapped in debt, especially after WW2 when the economy rose to power and prominence.
Deflation has been Japan’s economic setback since the early 1990s. The asset bubbles that were created after the WW2 had finally burst in 1989, after the increase of inter-bank lending rate from the Bank of Japan.

11. Once the stock market crashed and equity prices dropped, banks and insurance companies were left with lots of bad debt.
The Japanese government and central bank supported these organizations by bailing them out and providing low-interest credit. Thus, these firms have to rely on support. But this eventually became unsustainable, so banking institutions had to be consolidated and nationalized.
Throughout many years, other fiscal stimulus initiatives were also used to help reboot the stumbling economy. Because of these government-approved actions, Japan’s debt level skyrocketed to become the highest in the world.

12. Japan’s debt (including government bond liabilities) are held by its own citizen, so the risk of defaulting is much lower.
To know more about the complexity and seriousness of Japan’s debt predicament, we have to understand how the government pays for its commitments and public services annually.

13. In all economies, governments fund public services by levying tax to its citizens.
If total tax revenue exceeds public services costs, then there is a fund surplus. However, if the total amount of tax is less than government spending requirements, then is a fund deficit, and the government has to figure out how to cover this loss by borrowing.

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