Madrid 2020 Dismisses Financial Concerns Amid Spanish Austerity Drive

(ATR) Despite growing turbulence in the Spanish economy amid a fresh round of government spending cuts, Madrid 2020 tells Around the Rings the bid will not suffer – and the drive to secure sponsorship is on track.

Concerns over the Spanish government's support resurfaced Friday when Prime Minister Mariano Rajoy agreed to cut more than $36 billion to meet deficit targets. Under one of the toughest austerity drives in the country's history, budgets for many government ministries will be cut, public sector workers' salaries frozen and taxes for large companies increased.

Madrid 2020 told ATR that the cuts "will not affect at all the Madrid 2020 bid plans".

The bid's applicant file reveals a bid budget of $38.6 million, with $14.8 million of public funding from Madrid City Council in phase one of the campaign and $23.8 million coming from the private sector for the second phase if the city is shortlisted in May.

"The public funding budget has not changed after Mariano Rajoy's announcement," said a spokesperson.

With seven weeks to go until the May 23 IOC decision on the shortlist of candidate cities, ATR is told that 45 percent of the private funding for the bid coming from sponsorship "has already been negotiated".

Commenting on the bid's sponsorship drive, Madrid's international relations CEO Theresa Zabell told ATR: "Madrid feels very confident in reaching its goal of 62 percent of private funding for phase II of our bid campaign and we are looking towards the future, and to the candidate city phase, with great optimism."

Nonetheless, it would seem that Madrid 2020's bid remains in a precarious position.

Beyond the bid budget, the bigger question is whether the Spanish government can continue to back the idea of staging an Olympicswhen further spending cuts may be necessary that could ignite antipathy towards the 2020 campaign.

According to new figures published Monday, it emerged that Spain has the highest unemployment rate in Europe at 23.6 per cent.

Against the backdrop of the country's recession, Madrid 2020 points to the rock solid support of the city's mayor, Ana Botella, for the bid.

Madrid City Council has already allocated $9.8 million for the bid campaign through 2012, with another $5 million to come from its 2013 budget.

Last week, Botella announced the financialadjustment plans taken by Madrid City Council for 2012-2016 following the government cuts.

When asked if they included the Madrid 2020 bid, she insisted: "Madrid 2020 Olympic bid will be not suffer a decrease on the budget, as we are convinced that this is a country project and a major commitment.

"Furthermore, more than the 70 percent of the necessary infrastructures are already finished, and the ones left will only be built in the hypothetical situation that Madrid is chosen as Olympic city."

Madrid's bid officials are likely to spell out their government's commitment to the Olympics in a video conference with an IOC panel on Wednesday, which is aimed at clarifying some of the technical aspects of the applicant file in the eyes of IOC experts.

Bid leaders will also use a presentation to the general assembly of the Association of National Olympic Committees meeting in Moscow on April 14 to underscore the strength of the government's financial guarantees for the bid.

Reported by Mark Bisson

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