A little over two weeks before the opening ceremony on the Seine, INSEE is taking the plunge: national statisticians estimated on Tuesday, July 9, that hosting the Olympic and Paralympic Games in France should lead to an increase in growth of 0.3 points of GDP in the third quarter of the year.
“The impact of ticketing revenues and rebroadcasting rights would be approximately +0.25 points of GDP, to which should be added the knock-on effects, particularly on tourism (accommodation, catering and transport), as well as bonuses for civil servants present throughout the Games”, with more “uncertain” economic effects but which could generate an additional quarterly growth of 0.05 points, indicates the National Institute of Statistics and Economic Studies (Insee) in its latest economic report.
Overall, GDP would increase by 0.5% in the third quarter and by 1.1% over the whole of 2024. “Activity would slow down as a result at the end of the year,” adds INSEE, which anticipates a contraction of 0.1% in gross domestic product (GDP) in the fourth quarter.
An impact comparable to that of the London Olympics
The impact of the Olympic Games (July 26 – August 11) and Paralympic Games (August 28 – September 8) on the economy would thus be comparable to that of the London Games, which boosted the British economy by 0.2 to 0.4 points of GDP in the third quarter of 2012, marked by total growth of 1%.
While economists are often reluctant to compare the impact of different editions of the Games, INSEE accepts the parallel between the 2012 and 2024 editions. “London and Paris are two major European capitals of developed, touristic economies, with established urban infrastructures,” argues the statistical body, rejecting conversely the “less relevant” comparisons with the Rio Games in 2016 or those in Tokyo in 2021.
For the 2024 Olympics, most of the boost to growth is linked to ticket sales (+0.15 points of GDP, or 1.2 billion euros in revenue for the organizing committee) and broadcasting rights (+0.1 points of GDP, or 750 million euros in revenue), which INSEE has chosen to record in the third quarter.
Ticketing and broadcasting rights, the main cause
Because even if ticket sales for the Games began in 2023, they are in fact measured “at the time they are consumed by the public”, that is to say during the Olympic and Paralympic events, explains INSEE. The same logic prevails for broadcasting rights. The support provided by the 2024 Olympics to French growth would however only be very occasional and would not be repeated in the fourth quarter, according to its forecasts.
While the event should lead to an increase in consumption in certain sectors (accommodation and catering, transport), this would have a negligible effect on third-quarter growth. INSEE takes the example of television purchases, which sometimes tend to increase during major sporting events such as the Football World Cup. These purchases certainly support consumption, but they are often made to the detriment of other expenses, which neutralizes their beneficial effect on growth.
In early April, the French Economic Observatory had anticipated a “slight growth peak” linked to the Olympics in the third quarter, for which it expected total growth of 0.3%, before a slowdown to 0.1% growth between October and December. In May, a study by the Center for Sports Law and Economics (CDES) estimated that the Games should generate between 6.7 and 11.1 billion in economic spinoffs for Paris and its region, where the majority of the events will take place.
But in this work commissioned by the organizing committee and the International Olympic Committee, the repercussions extend over nearly twenty years, between 2018 and 2034. The CDES figures “are not directly comparable with the impacts on short-term growth” revealed this Tuesday by INSEE, national statisticians have warned. The study published in May focuses in particular on the “residual effects” (post-Games) of the event and includes “multiplier effects” in its calculation, unlike INSEE which only reports on the “direct short-term effect” in the third quarter of 2024.