Related topics

Brazilian officials present infrastructure budget

January 28, 2014

RIO DE JANEIRO (AP) — Brazilian government officials said Tuesday the country will spend 5.6 billion reals ($2.3 billion) on about half of all infrastructure projects needed specifically for the 2016 Rio de Janeiro Olympics, with the total cost yet unknown.

The cost estimate was released by the Olympic Public Authority, which coordinates planning for the Olympics between Brazil’s three levels of government — national, state and local. Officials presented costs for 24 of the 52 projects needed to host the games. They said the remaining projects would drive cost higher, but offered no estimate.

Deputy Sports Minister Luis Fernandes acknowledged government officials have been “under pressure” from Brazilian media to present long-delayed cost estimates, having previously changed the makeup of their budgets from the composition used in the winning bid back in 2009.

Cost overruns and delays have characterized Brazil’s buildup to this year’s World Cup, and Olympic officials want to be seen as spending less, and spending it more prudently.

“We have to be clearer in our communication.” Fernandes said. “That we understand. We have to communicate in a clear fashion. That’s what we’re trying to do here now.”

In the original bid documents, officials listed the overall Olympic cost at about $14 billion. That is about the same amount being spent on this year’s World Cup. That event has prompted violent street protests about big spending on mega sports events in a country with poor schools and hospitals.

Last week, the Rio organizing committee announced its operating budget at $2.9 billion, lower than expected. That covers operational costs for the games themselves, including things like technology, workforce, and administrative costs. A $700 million government subsidy was removed, lowering the budget figure.

Income for that budget is from sponsorships, ticket sales, merchandising and a $1.1 billion contribution from the International Olympic Committee.

Tuesday’s budget deals with building infrastructure directly related to the games — such as sports venues, athletes’ village, media centers. Projects are funded by public and private money.

Left out of both budgets are the most expensive projects: a 16-kilometer (9-mile) extension of the city’s subway system from central Rio to the center of the games in the Barra da Tijuca area; adding four high-speed bus lanes; and renovating a decaying port.

Rio organizers say those huge projects would have been built anyway — regardless of the Olympics — and should not be seen as expenses for the games.

Major General Fernando Azevedo e Silva, who heads the Olympic Public Authority, was asked if the Rio Games could overcome tight deadlines, delays and be ready on time.

“There is not much flexibility,” Silva said. “We don’t have great flexibility, but I think it is possible.”


Stephen Wade on Twitter: http://twitter.com/StephenWadeAP

Update hourly