July 4th 2007 was a great day for President Vladimir Putin. Years of intense lobbying with the International Olympic Committee had been worth it: the attractive seaside resort Sochi by the Black Sea was chosen as the site for the Winter Olympics in 2014. Two years before Moscow, among others, had lost out to London in the bid to host the Summer Olympics in 2012.
Sochi is a jewel in Putin's crown. Without doubt it is to be showcased as Putin's Russia when he might well be into his third presidential four-year term after the elections in 2011.
Sochi's humble beginnings are a far cry from the restored Russian pride it wants to portray to the world in 2014. In 2007 the Russian economy was on the road to heaven, not a cloud in sight. We now know the bitter experience of the serious financial recession, which is hitting Russia harder than most.
Sochi had to start from scratch. Five years ago the city did not have an airport, decent roads, hotels, sports arenas, or much other infrastructure to speak of. Yet the Olympic outdoor disciplines scheduled to take place at Krasnaya Polana in the Caucasus mountains require a further one billion dollars to finish the sports sites, making it the biggest ski resort investment in the world.
Russia has had to commit its close circle of loyal and cooperative oligarchs to bring their riches to the party. Oleg Deripaska was to invest 1,5 billion dollars in residential sites and the new international airport. Another oligarch, Vladimir Potanin, should invest 500 million in an alpine ski resort. The problem now is to find out if these gentlemen with their highly geared and speculative economies are still among the richest people in the world - or if they are actually now broke!
Panic is spreading in Sochi. Constructions are far behind schedule, organisation and coordination is poor and finance uncertain. President Medvedev has fiercely criticised the lack of progress. It is not unforeseeable that Sochi might even have to relinquish the Olympic Games in 2014, or indeed, be disqualified by the IOC for the failure to meet their specifications.
In any event, Sochi may look forward to a gloomy economic future for the after-use of its expensive facilities. Russia has never been a tourist country. Inconvenient travel arrangements and complicated visa regulations do not make winter sports in the Russian Caucasus particularly tempting or attractive for European or American tourists. So, the best clientele they can hope to attract will be the Russians themselves but as the Russian economy continues to plummet only Putin's friends will be able to afford it.
Ivar Amundsen
Director, Chechnya Peace Forum
