Rio Olympics Can’t Pay Debts, Offers Used Air-Con Units Instead

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The final contest of the 2016 Rio Olympics looks a lot like “Let’s Make a Deal.” With 100 million reais ($32 million) in outstanding debts, the organizing committee is trying to pay off suppliers with stuff — air conditioners, portable energy units, electrical cables — in lieu of or in addition to cash.

The cash crunch is a legacy of the financial crisis that hit Brazil just as preparations for the Olympics were getting underway. Rio 2016 is now asking creditors to agree to settle debts for 30 percent less than they’re owed, said Mario Andrada, Rio 2016’s head of communications.

Andrada said Rio remains hopeful it will meet its obligations by June, when the organizing committee shuts down. If it doesn’t, the burden will pass to local and state governments that backed the committee’s credit. Both governments now have financial trouble of their own, and it’s not clear whether they can pay off Olympic debts either. The state government, on the verge of bankruptcy, is already struggling to pay public servants.

“We are confident we will come to an agreement and will honor our commitments,” Andrada said. He said the committee is still waiting on some money from sponsors.

Read Bloomberg

Photo by Brian John Godfrey

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