Beijing looks to strike gold with 2008 Olympics

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BEIJING, China -- Beijing's selection as the host city for the 2008 Olympic Games will be a boon for China's economic development, including its tourism industry, analysts and Asia tourism experts said.

The International Olympic Committee on July 13 awarded the Games to Beijing, which beat out Istanbul, Turkey; Osaka, Japan; Paris, and Toronto.

The Beijing bid committee said it expected overall revenues of $1.62 billion for the Games, which will cost the city $1.606 billion, yielding a modest $19 million profit.

But the economic impact of the Games could be far greater. Analysts estimate that a Beijing Olympics would boost China's gross domestic product by 0.3% per year from 2002 to 2008.

Beijing 2008 logo.The first Chinese Olympics in history will prompt Beijing to undertake its greatest building effort since the construction of the Great Wall, with more than $20 billion earmarked to upgrade public transportation, expand airports, lengthen expressways and build new subways.

In an effort to accommodate Olympics-bound visitors, Beijing said it plans to grow its hotel room inventory by more than 50% from its current 85,000 rooms to 130,000 by 2008.

"The hotel sector should experience the greatest impact" from the Olympics, said Melinda McKay, vice president of research for Jones Lang LaSalle, a real estate development and investment management firm in Chicago.

"The Games will result in significant new hotel construction as well as refurbishment of existing properties," McKay said. "Depending on how effectively Beijing leverages the Games, it could have long-lasting and far-reaching implications for the city's tourism, hotel and convention sector."

One hotel firm that stands to benefit from a Beijing Olympics is Shangri-La Hotels, the Hong Kong-based operator of upscale hotels in Asia. Of the company's 16 owned or operated hotels in mainland China, four are in Beijing.

"The Beijing Olympics will give us additional exposure within the global corporate community, in addition to opening up our product to people who aren't familiar with Shangri-La," said Carolyn Blackburn, the company's director of sales for the eastern U.S. and Canada.

Blackburn said she has seen Beijing go through "dramatic changes" during her tenure at Shangri-La.

"Beijing was somewhat gray when I first visited 10 years ago," she said. "There weren't many colors to its pallet. But now it's alive in color and architecture and art, and it's a vibrant place to visit."

Beijing is making sure that green will be a prominent color throughout the city. It is expected to spend $1.6 billion on sports facilities and public spaces for the Games, including a 3,000-acre forested park known as Olympic Green, which will contain venues for 15 sports, including the 80,000-seat main stadium.

Additional sports events and venues are planned for sites outside Beijing, including Qingdao on China's east coast, which will host sailing events, and Shanghai, which will host soccer.

On the environmental front, the city announced it would spend $12 billion to clear smog by shutting polluting factories and moving them to the outskirts of the capital, where they will burn natural gas instead of coal. The city's buses and taxis also will switch to natural gas to cut pollution.

Spurred in part by its Olympic bid, even the capital's public toilets are getting a royal flush. The city has embarked on a two-year renovation plan for more than 450 toilets at some 300 tourist sites, with the cleanest commodes receiving a four-star rating.

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