Olympic Host Country Facing Economic and Political Crisis
Author(s)
Jon Stone
Media Relations Manager
The eyes of the world will be on Brazil, but you might not see the real picture
The Olympics are officially underway. Soccer couldn鈥檛 wait for Friday鈥檚 opening ceremony as Sweden鈥檚 women's听team defeated South Africa 1-0 on Wednesday. Once the television coverage begins, we will all see the stunning new venues, the amazing views of the city and the gorgeous beaches. The one thing that will likely be left out is how Brazil is struggling both economically and politically.
The city of Rio de Janeiro was awarded the Olympics in 2009, just two years after being awarded the 2014 World Cup. While the U.S. was suffering through a financial crisis, Brazil鈥檚 economy grew by more than 7 percent. 鈥淏razil had gained the confidence of bodies like the International Olympic Committee and the International Federation of Football Association,鈥 says听, director of the听听in the . 鈥淏razil seemed to escape its historical pattern of always suffering in exaggerated fashion whenever markets around the world dropped.鈥
Now, the economic woes have caught up with Brazil. The country鈥檚 economy shrank by nearly 4 percent in 2015, and a similar drop is expected for 2016. Inflation has reached a 12-year听high. And unemployment has climbed to 9 percent.
Once the economy slowed and the government remained committed to large outlays for sports facilities, people became more dissatisfied with prioritizing stadiums instead of hospitals, schools, roads and more useful infrastructure.
Prof. Aaron Schneider, Josef Korbel School of International Studies
鈥淏razil has suffered in a time of international slowdown, as it cannot compete with the high value-added activities of more developed countries nor can it compete with the low wages of poorer countries,鈥 Schneider says. 鈥淭he fall in (export) prices since 2012 has left Brazil with few options in the international economy.鈥
The political turmoil facing Brazil is not helping the economic problems. President Dilma Rousseff has been suspended from office as she goes through an impeachment trial over accusations she manipulated government accounts. The vice president is currently running the country.
Now Brazil is preparing to be seen by the eyes of the world. Seven years ago, this was viewed as a major victory for the country. 鈥淭he Olympics and the World Cup seemed to validate Brazilian international legitimacy and served as a source of pride,鈥 Schneider says.
Now Brazil faces its worst economic crisis in more than 80 years. According to a听听by Public Radio International, public and private sectors in Brazil spent $15 billion to host the World Cup. Nearly $10 billion more has been spent preparing for the Olympics. The costs are staggering when compared to the $600 million spent to battle the Zika virus. 鈥淥nce the economy slowed and the government remained committed to large outlays for sports facilities, people became more dissatisfied with prioritizing stadiums instead of hospitals, schools, roads and more useful infrastructure,鈥 Schneider says.
