Highlights
– Activists pressure Olympic sponsors to withdraw support from 2008 Beijing Games
– BOCOG faces intellectual property rights lawsuit
– Chinese inflation hits an 11-year high, highlighting the inability of the Chinese government to effectively handle disasters
The 2008 Beijing Olympic Games is expected to be a global coming-out party and a chance for China to show the rest of the world how it has evolved to become an integral player in the international economy. To date, the Beijing Organizing Committee for the Games of the XXIX Olympiad (BOCOG) has spent US$1.8 billion on projects throughout the capital city specifically for the games and another US$35 billion on miles of subway lines.
Nevertheless, the media’s attention on the Beijing Olympics has not been without negative coverage. Numerous activists have used the Games to publicize their cause, leading some BOCOG organizers to worry that sponsors may pull out before the Games even begin.
Additionally, problems concerning property rights and soaring food costs have leaders worried that the coming-out party may not be as glamorous as China originally hoped.
Activists Threaten Ad Spending Surge
On February 20, 2008, Yuan Bin, the head of the Beijing Olympics marketing department appealed to activists not to pressure sponsors to pull out of the Games. A total of 32 partners and sponsors of the Beijing Olympics spent approximately US$2.6 billion in 2007, up 23 percent from 2006. More than 50 sponsors have signed up for the Beijing Olympics, more than at any previous Olympics and Yuan claims the marketing revenue will be enough to underwrite the entire cost of running the Games.
Numerous human rights groups have used the Olympics as a chance to highlight issues such as China’s controversial rule of Tibet, the precarious relationship with Taiwan, and its role in Sudan. Yuan most likely chose this time to speak out against the activists due to the recent resignation of Hollywood director Steven Spielburg as an artistic advisor to the Olympics.
Property Rights
In addition to the activists, the BOCOG is currently facing a lawsuit from a Beijing resident who claims the organizing body violated his intellectual property rights. On January 30, 2008, Fang Shouwei reported that he has evidence he proposed the Beijing Olympic slogan “One World, One Dream.”
The BOCOG launched a global campaign in 2005 to find a slogan for the Games and offered a certificate of recognition to the winner. However, no winner was announced and the organizers claim the chosen slogan was a collaboration of “the wisdom of hundreds of thousands of people.”
An official of the intermediate court in Beijing’s Haidian district confirmed that a preliminary hearing of the case was scheduled in early February, but it is unlikely Fang will receive compensation for the slogan.
Winter Inflation
Although the Olympics are generating billions of dollars in marketing revenue, the severe winter weather has pushed inflation to an 11-year high. In January 2008, consumer inflation was 7.1 percent, up from only 6.5 percent one month earlier. The massive snow that hit a large part of China in late January 2008 and early February 2008 also contributed to the rise as millions of livestock were killed and crops destroyed.
However, soaring food costs are only one part of the record inflation and even though additional severe weather is unlikely for the remaining weeks of winter, prices are expected to increase further.
Economic Outlook
In the last 30 years, China’s economy has developed rapidly, attracting investors from around the world. Although activists will continue to persuade companies, countries and athletes to boycott the Beijing Olympics, they are unlikely to cause a significant impact on either the Games or China’s economy as a whole. None of the sponsors has shown any indication of withdrawing support and the International Olympic Committee has repeatedly stated that the main focus of the Games is sports, not politics.
Further, the rising prices of commodities illustrate not only China’s growing battle with inflation but also the inability of the country to handle natural catastrophes. The slow and inept response of the government to deal with the severe winter weather does not bode well for the future.
