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June 25, 2021

IOC pushes Tokyo Olympics amid pandemic – leading macroeconomic influencers

The IOC plans to move ahead with the Olympics this summer despite growing skepticism around the pandemic and the possibility of a post-Olympic Covid wave.

Commentators highlight the huge financial incentives behind the International Olympic Committee’s (IOC) insistence on holding the games amid a pandemic. The NBC, IOC, and Discovery are some of the leading benefactors looking to leverage the games to boost their revenues.

Brad Humphreys

Brad Humphreys, an associate professor in the department of economics at the University of Alberta in Edmonton, Alberta, retweeted on how ingrained it is for the Olympics to overspend.

The Tokyo Olympics was budgeted to cost $7.3bn, but will now be costing $30bn with all but $6.7bn to be covered by Japanese taxpayers. Although health experts question the safety of proceeding with the games with only 6% of the Japanese population being fully vaccinated against Covid-19, the mass media company NBC is pushing ahead with billions at stake.

Regular reports from polls have also cited growing concern among the public to go ahead with the games amid the pandemic. Although caseloads have dropped in Japan due to warm weather, data suggests that the country still has more than 25,000 active cases with the dangerous Delta variant becoming prominent.

Jules Boykoff, a professor at Pacific University who specialises in sports politics, stated that the relationship between NBC and the IOC which is pushing the Olympics during the pandemic raises ethical questions about both parties. A post-Olympic Covid-19 wave is therefore imminent.

Stephany Griffith-Jones

Stephany Griffith-Jones, economist specialising in international finance and development, retweeted on the International Monetary Fund (IMF) plans on special drawing rights (SDRs) becoming clearer. Economists believe that SDRs are imperative to rescue poorer countries from the effects of the coronavirus pandemic.

The IMF, as a result, is working on a proposal to supply low- and middle-income economies with $650bn of its reserve funds to purchase Covid-19 vaccines, pay down their debt, and also expand their relief programmes. Experts further believe that these SDRs should not have any conditionality and there should be accountability mechanisms in place.

Experts believe that developing countries are unable to tackle the pandemic on their own or procure additional vaccines due to the growing debts. Looking for a final passage by August, the IMF is looking to advance the proposal in an upcoming meeting. It is expected to be the largest capital allocation since the end of the World War II.

Fund officials are also working on a plan for richer member countries to transfer some of their reserves to poorer countries in an effort to reduce debts and alleviate poverty levels.

Mark Weisbrot

Mark Weisbrot, economist and co-director of the Center for Economic and Policy Research (CEPR) in Washington, D.C., retweeted an article on researchers measuring the impact of the Covid-19 recession on 20 to 24-year-olds in the US, finding that about 3.81 million were not employed or studying in any school in the first quarter of 2021, an increase of 740,000 compared to the first quarter of 2020.

Economists believe that young adults tend to be hit harder during economic recessions and also tend to suffer long-term consequences than older adults. An earlier research by the CEPR revealed young adults were disproportionately affected by the pandemic-induced economic shock, with a number of sectors having closed and not showing signs of a quick recovery and young workers left on the lurch.

A recent analysis found one in in four Black 20- and 24-year-olds was neither studying in any school or employed during the first three months of this year, compared to one in five Hispanics and one in six whites. In addition, during the 2020 pandemic, Black young adults experienced the largest increase in NEET rates (7.6%), a mechanism of measuring the share of an age group not involved in any training, education, or work, compared to 4.4% for white young adults.

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