Rio Olympics to Boost Brazil Economy, Finance Minister Says

Guido Mantega, Brazil’s Finance Minister, said the hosting of the 2016 Olympics will stimulate economic growth in the coming years.

Rio de Janeiro’s selection yesterday over Chicago, Madrid and Tokyo will spur investment in hotels and infrastructure, Mantega told reporters in Istanbul, where he’s attending an International Monetary Fund meeting. Together with the discovery of oil in the so-called pre-salt area and the hosting of the 2014 World Cup, the Olympic games will enhance Brazil’s global stature, Mantega said.

“It caught me by surprise and we still have to do the math,” Mantega said. “But just like the pre-salt will add 1 to 2 percent to gross domestic product in the coming years, the Olympics and World Cup will each add 1 percent. It won’t be long before we’re growing too much.”

The Finance Minister said he was congratulated by finance officials from China, Russia, and India during a meeting today of the so-called BRIC countries, which was later joined by U.S. Treasury secretary Timothy Geithner.

“Geithner didn’t say a thing, nor did we,” Mantega joked. “You never mention rope in the house of a man who has been hanged.”

Central Bank President Henrique Meirelles said the awarding of the Olympics would help strenghten the economy and encourage investments. He cited a World Bank study showing that Brazil, if it maintains an annual growth rate of about 5 percent, may become the world’s fifth largest economy when the Games open.

“It’s a symbolically important choice,” said Meirelles, who was present in Copenhagen yesterday for the decision by the International Olympic Committee. “One of the worries the IOC had in selecting a host from a southern hemisphere emerging market was related to our financial stability and capacity” to organize the event.

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