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Olympics to add oomph to Beijing economy
By Zhao Huanxin (China Daily)
Updated: 2006-01-17 05:39

As Beijing counts down to the 2008 Games, some people in the host city may well be counting the money.

The Games will help the capital register sizzling economic growth and create hundreds of thousands of jobs, the city's leading statisticians said yesterday.

Because of the "Olympic factor," Beijing can expect its gross domestic product (GDP), after stripping out inflation, to grow at 9.8 per cent a year leading to 2008, 0.8 percentage point higher than the average growth between 2001 and 2005, Wei Xiaozhen, a division director of the Beijing Municipal Bureau of Statistics, said yesterday.

A cumulative 1.82 million jobs will be created between 2004 and 2008 thanks to the Games, Wei and her colleague Yan Ping concluded in the city's 2006 economic development report published on Sunday.

The "Olympic factor" refers to the impetus generated by 134.86 billion yuan (US$16.65 billion) in direct investment for hosting the Games, Wei said.

Based on projects listed in the Games' action plan, 79 per cent of the funds will be channelled into post and telecommunications, infrastructure facilities and improvement of the living environment, the report says.

The funding will give a shot in the arm to at least 50 industrial and business segments related to the Games, it says.

"Beijing's preparations for the Olympic Games also mean tremendous opportunities for foreign investors, who could become part of the growth story through bidding or supplying accessory products and services," Wei told China Daily.

Based on analyses of former Olympic host cities such as Seoul and Sydney, as well as ground realities in Beijing, Wei's research team estimates the "Olympic factor" will add 5.45 billion yuan (US$673 million) to the city's finance and insurance sector in five years from 2004, and 17.28 billion yuan (US$2.13 billion) to the construction industry.

The two sectors, along with retail and wholesale, real estate, computer services and software, communications and computer equipment manufacturing, will further cement their roles as Beijing's pillar industries in the years ahead, according to the report.

Construction of Olympic venues and related facilities will translate into 430,000 extra jobs in the sector in five years, the report says.

But employment will shrink significantly when construction of projects draws to an end, it adds.

Other top employers benefiting from, and bolstered by the "Olympic factor" are wholesale and retail, equipment and instrument manufacturers, and light and textile industries, the book says.

For tourism, 2008 will be also a bonanza year.

The report predicts that at least 2 million more people will visit Beijing in the year, Wei said.

"In addition to the normal increase of the number of tourists, the Games will bring an extra 2 million people to Beijing during, before or after the Games including 300,000 from outside the mainland," Wei said.

Each overseas visitor is expected to spend US$1,050, while expenditure of domestic travellers will average 1,200 yuan (US$148) per person, generating a combined revenue of nearly 7.7 billion yuan (US$950.1 million), the report says.

The number of visits to Beijing increased from 95.12 million in 1999 to 123.15 million in 2004, according to official statistics.

The report does not project the total number of visitors Beijing will receive in 2008, neither does it attempt to predict how much profits the Games will make.

(China Daily 01/17/2006 page1)



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