Tokyo Olympics could seal Japan’s revival: Analysts

Tokyo Olympics could seal Japan’s revival: Analysts
People receive extra copies of newspapers reporting that Tokyo had been chosen to host the 2020 Olympic Games in Tokyo September 8, 2013.

TOKYO - The 2020 Olympics could seal the revival of Japan's long-stagnant economy, analysts say, an echo of the 1964 Tokyo Games that showcased a nation risen from the ashes of defeat.

Staging the world's biggest sporting jamboree "is clearly a plus to (economic) growth" Prime Minister Shinzo Abe told journalists in Buenos Aires, hours after the Japanese capital was named as host.

"Japan has had 15 years of economic stagnation... and we've lost confidence in ourselves. But I hope this will be a chance for us to regain that confidence," Abe said.

In the 1960s the Games were the coming-out party of a country that had grown to respectability after the ignominy of occupation following World War II.

The 1964 Olympics heralded the arrival of what was to become a huge and vigorous economy - until recently the world's second biggest - and one that shook up the global order until it all came to a shuddering halt at the end of the 1980s.

Two decades of anaemic growth and investment-sapping deflation saw China push a floundering Japan into third place, as repeated attempts to kick-start the economy did little but add to a mountain of debt.

But Abe's election in December kindled hope of a recovery, and his economic plan, dubbed "Abenomics", has encouraged the green shoots of a recovery that optimists say might really take hold.

Now they hope that a second bite of the Olympic cherry could cement that recovery and recharge a country once known for its economic vigour.

"The most important thing about the 2020 Tokyo Olympics is that it has reduced risks of Abemonics failing in the middle," said Hideyuki Ishiguro, senior strategist at Okasan Securities.

The Tokyo Metropolitan government estimates that hosting the Olympics will see about three trillion yen (S$38 billion), or less than one per cent of Japan's Gross Domestic Product, being spent in the seven years to 2020.

But Ishiguro says the real impact will be much bigger.

"The Tokyo government's estimate doesn't include redevelopment of roads and other social infrastructure in the greater Tokyo area, nor the government's plan of repairing and rebuilding infrastructure nationwide," he said.

More about

Your daily good stuff - AsiaOne stories delivered straight to your inbox
By signing up, you agree to our Privacy policy and Terms and Conditions.