For Leipzig, the Olympic Dream Begins

More than 40,000 people celebrated in the streets of Leipzig in April when the city was chosen as Germany's hope to host the next Olympic games.

The east German city beat off competition from Hamburg, Düsseldorf, Frankfurt and Stuttgart to host the summer games in 2012. Rostock, which was chosen to host the Olympic sailing competition in the German bid, vied against the port cities of Kiel, Lübeck, Stralsund and Cuxhaven.

But as candidate cities all over the world enter the second and final selection round to host the oldest competitive games today, the real work starts for Leipzig, which is hoping to boost jobs and make its region -- which like much of the formerly communist eastern Germany is suffering from economic doldrums -- into a town the International Olympic committee can't turn down when it makes its final decision in early 2005.

Germany has not hosted the Olympics since the 1972 summer games in Munich, which where marred after Palestinian terrorists held the Israeli team hostage. Two were shot dead by gunmen and nine others died during an ill-fated rescue attempt which turned the event into one of the darkest events in Olympic history.

Sprucing up the city

Leipzig is eager to create some positive Olympic history for Germany.

Some €30 million ($33.98 million) is set to be invested in the city in preparation for the next stage of its Olympic bid.

Most of the money will come from the state of Saxony, of which Leipzig is second-largest city after Dresden. Leipzig and its partner cities are also expected to contribute. Leipzig has already doubled its order for new trams for the city (the cost of which has already run into millions of euros). It will also have to prove to the International Olympic Committee it can provide a minimum of 42,000 hotel rooms and cope with an influx of 150,000 participants and as many as 500,000 spectators during each day of the competition.

Demands from city leaders are increasing for additional redevelopment projects in the city, where infrastructure languished and deteriorated under decades of communist rule until the fall of the Berlin Wall in 1990 and German reunification. Indeed, the push from outlying Leipzig areas to get their hands on funds earmarked for the Olympic effort has become a strain. So much so, in fact, that Leipzig Mayor Wolfgang Tiefensee has been forced to decide to keep the Olympic efforts within a 10-kilometer radius of the city center.

A massive and expensive endeavor

All of this does not come cheap, of course. If Leipzig does win its bid, the city will have to raise an estimated €2.6 billion to construct the sports halls, Olympic playing fields and residential village that the enormous event requires. How this funding will be split between local, state and federal governments remains an open question.

But if €2.6 billion has Leipzig's purse-string holders quaking in their boots, they can take comfort in the fact that the games have served as an economic booster for a number of host cities, which have in many cases made a profit on their initial investment. The games helped places like Munich, which hosted the summer Olympics in 1972 and Barcelona, which played host in 1992, transform themselves into world cities. Others enjoyed windfalls from sales of TV rights, advertising and ticket sales. Sydney, which hosted the last Summer Olympics, made a cool €1.5 billion.

But for Leipzig, winning the games would mean a whole lot more. In addition to the symbolic importance of awarding the games to a city that has pushed for the past 12 years to become a business center, it would also create much needed jobs in a languishing labor market.

With an average unemployment rate of 18.3 percent, the number of jobless in eastern Germany is more than double that in western Germany. Between 1992 and 1998, the federal government poured €600 billion into the local economy, but it has still failed to bloom.

Olympics as economic booster shot

Local business leaders have said the Olympics could create as many as 38,000 jobs by 2012, though many would disappear again after the Olympics.

The dream might come true for Leipzig. Although one of the smaller cities competing to host the games, Leipzig has heard encouraging words from the Olympic organizers.

"Germany, Leipzig and Rostock have good chances. We know they are exacting in organization and have a team with good experience," International Olympic Committee President Jacques Rogge said in April. "Other small cities have had the Olympic games, too, like Lillehammer (in Norway). Helsinki wasn't big either. We want to reduce gigantism."