An interesting report was featured in Reuters and more recently on Gamebids.com, on the 2014 Olympics to be held in Sochi, Russia, costing 15 percent less than originally anticipated as initial budget estimates exaggerated the projected cost.

In a Reuters interview on Tuesday, March 11, Russian Deputy Prime Minister Dmitry Kozak said the state will fund 108 billion roubles of the project in the new budget, and the private sector will pay the remainder after the 15 per cent cut to its initial cost estimates.

 ”We have indeed estimated the budgetary cost to be 15 percent lower,” Dmitry Kozak, who is in charge of preparations for the Olympics, had previously told Prime Minister Vladimir Putin in a meeting. The reduction represented total savings of 300 billion rubles (8.4 billion dollars).

 As excerpted from Reuters:

While Kozak explained the cost savings in terms of accounting there has been mounting concern about the capacity of the Russian budget to cope with hosting the Games. The country has been grappling with a financial crisis and a plunge in world prices of oil and gas, its main exports.

Russian officials have warned that the country’s budget deficit could reach around 8 percent of GDP in 2009. A deputy minister warned on Tuesday the economy would contract by 2.2 percent in 2009. The Prime-TASS news agency had said earlier Tuesday that Russian private firms were shying away from bidding to build much-needed infrastructure in Sochi. The report said local authorities were recently forced to extend tender deadlines for Olympic-related construction contracts due to lack of interest from companies hit by financial difficulties.

Authorities also faced mounting difficulty in acquiring land necessary for construction of Olympic infrastructure in the southern Russian city of Sochi because owners were refusing to sell at prices offered by the government.

 The Austrian city of Salzburg, which lost out to Sochi for the right to host the 2014 winter games, said in November it was still prepared to do so if the Russian host was unable to complete infrastructure construction in time.

Putin in January personally drove the International Olympic Committee’s pointman for the 2014 Winter Olympics Jean-Claude Killy on a tour of the host city to prove Russia was ready. But now his government faces pressure to ensure it finishes the building work in time.

The Olympic ceremonies have for generations highlighted more than the athletes competing, but in the host nation’s capacity to showcase the event and create a dynamic infrastructure around it. One must wonder in these times of economic disparity if Sochi 2014 or even Vancouver in 2010 will be the first truly globalized symbol of what we already know - the global community shares symptoms of recession.