Rio stands by $14.4 billion budget

LONDON -- Leaders of Rio de Janeiro's bid for the 2016 Olympics say the Brazilian government has fully guaranteed the proposed $14.4 billion cost of the games -- which is nearly as high as the budgets of the three other candidates combined.

Brazilian bid organizers said their budget figure, despite being much greater than its competitors, offers security and risk-free funding at a time of global economic crisis and is more realistic. Already, the budget for the 2012 London Olympics has soared to $16.5 billion, more than twice its original estimate.

"Brazil represents the safest choice," Rio 2016 secretary general Carlos Roberto Osorio said Monday. "The Rio bid is a bid of certainty. Everything in the budget is guaranteed. If we get the games, we can start getting ready from Day 1. There will be no surprises afterward."

Rio officials outlined their bid plans at a news conference in London, three days after releasing their candidate files in Brazil.

Rio is seeking to bring the Olympics to South America for the first time, competing against Chicago, Madrid and Tokyo. All four cities submitted their bid documents last week to the International Olympic Committee, which will select the host city on Oct. 2 in Copenhagen.

With the world gripped in a recession, financial issues will come under intense scrutiny during the bid campaign.

Rio's price tag for the Olympics stands out sharply from the other bid cities: Tokyo proposed a budget of $4.4 billion, Chicago $4.8 billion and Madrid $5.6 billion. The combined budgets of those three come to $14.8 billion.

"Even in the current difficult global economic climate, we can guarantee that funding for Rio 2016 is secure and that the Brazilian economy is stable," Brazilian government leaders said in a letter in the bid book. "Already the 10th largest economy in the world and forecast to be the fifth by 2016, Brazil will be able to support all projected games requirements."

Rio's costs include the organizing committee's operating budget of $2.8 billion, which is raised through television rights, sponsorships and ticket sales. The Brazilian government would cover 24 percent of that total, officials said.

"We are being conservative in our marketing revenue projections in the current crisis," Osorio said. "The government money is up front and guarantees cash flow. There is no need for loans or donations."

The separate non-organizing committee budget of $11.6 billion covers construction and infrastructure costs, including renovation of airports, roads and subway lines.

The funding would be covered in part by the government's existing $240 billion investment program.

The Olympic budget is guaranteed by the federal, state and city governments.

"Everything that is in the book, every line -- that is what we are going to do," Osorio said. "We are ready to go the extra mile to show it. Our budget is realistic. Everything is described and accounted for. It gives us a layer of certainty."

Rio, which is relying heavily on venues used for the 2007 Pan American Games, says 74 percent of the sports facilities needed for the Olympics already exist. The rest will be a mix of temporary and new venues.

Rio would use some of the city's iconic sites under its plan, including beach volleyball on the Copacabana. The Maracana stadium, which is being renovated for the 2014 World Cup, would host the opening and closing ceremonies and football final.

The Joao Havelange Stadium would be upgraded from 45,000 to 60,000 seats for athletics. In a bid to appeal to youth, a new "X-Park" would be built for mountain bike, BMX and canoe slalom events.

While recent Olympics have faced problems with empty seats, Osorio claimed Rio can "guarantee" full stadiums. He said organizers would offer affordable tickets for all, do away with some ticket bundling packages and have shorter competition sessions.

Rio, meanwhile, continues to use one of Chicago's greatest advantages -- the support of President Barack Obama -- for its own purposes.

"In this Olympic race, Rio is Obama," Osorio said. "We are saying, 'Yes we can.' We are talking about change, about hope. Rio can rejuvenate the games."