Tokyo Olympic Games

Long waited news had arrived at Japan from the other side of the globe. 2020 Olympic games will be held in Tokyo, Japan. Critics had lost their tongue suddenly and all people seemed to be happy. If you search its economic effect of Tokyo Olympic with Google, you'll get over 11 million results. Major newspapers and TV broadcasters show favor. You may find good opportunity to do business in Japan.

Followings are some of points that opposing economists accused often.

  1. Like Nagano Winter Olympic, local government will have budget deficits.
  2. 300-billion-yen-effects is only 0.5% of Japanese GDP.
  3. Using existing facilities, which is the one of the Tokyo Olympic concept, will reduce investment.
  4. It effects only psychologically.

I and 3 conflict each other and 300-billion in 2 is not calculated with the psychological effects in 4.

Japansee characters expressing Business condition"Kei-ki" means business condition in Japanese with two Chinese characters. The first letter "Kei" is used in landscape, too. The second, "Ki" expresses mood, atmosphere, spirit or mind. Actually, there is no exact translation of "Kei-ki" in English. Japanese feels business condition relies on psychology by the letters. In reality, Private Consumption in GDP is about 60.7% in 2012.1 ( The US is higher, 70%.)

After the last Tokyo Olympic, 1964, many Japanese felt good "Kei-ki" with rise of stocks and real estate. Actually, Japanese economy grew average 9.1% every year form 1955 to 1973, the year of Oil Shock. People who knew the last one is over 60 years old now and they have much money in Japan. The research in 2012 shows that median amount of saving is 13.98 million yen for 60's and 2 million yen for 20's.2

Others worries rise of consumer tax in 2014. It is known that it is only short time effect. Besides, people are start buying expensive durable consumer goods such as cars and houses before the tax raise. As for real estate, most of investors think it will be good for a while. According to the Nikkei newspaper, REIT is on favor because of Tokyo Olympic3 and Asian rich is buying condominiums in Tokyo while yen is cheaper.4

The psychological effect might not be undertaken.


1. Cabinet Office press release on Dec 25th 2012
2. The Central Council for Financial Services Information
3. Domestic REIT index is up.,
4. Asian riches buy expesive real estates in downtown Tokyo.,

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