Putin to Wean Sochi Off Olympic Funding, Favoring Family Resort
Russian President Vladimir Putin said Sochi will have to come up with its own funds to attract tourists after the Winter Olympics, urging locals to opt for a family friendly resort rather than a gambling hub.
“For all the love for Sochi, it now must be developed through very different means,” Putin said at a meeting with Sochi citizens’ representatives. “Additional investment can’t really be expected after the enormous resources invested here.”
The Russian government and investors poured an estimated 1.5 trillion rubles ($44 billion) into preparations for the Black Sea resort to host this year’s games, including doubling the number of hotel rooms. A record 4 million Russian tourists flocked to Turkey last year, who with visitors to other Mediterranean and Black Sea resorts could be targeted for Sochi, Putin said.
Sochi, with a population of about 400,000 people in the greater area, should remain a family resort rather than a gambling zone, even if that would to accelerate the return on investments, Putin said at the meeting yesterday.
“This is not for a small group of select citizens who can spend hundreds of thousands of dollars in casinos,” Putin said. “This is, frankly speaking, for the general public.”
The Black Sea city at the foot of the Caucasus Mountains, a vacation retreat favored by dictator Joseph Stalin, is hosting Russia’s first Winter Olympics, which opened Feb. 7. About 3.8 million Russians vacationed in Sochi last year, Deputy Prime Minister Dmitry Kozak said last week.
While Putin is seeking to showcase Russia and draw tourists to the region year-round, the event has generated criticism and ridicule from journalists and some athletes for the massive budget, unfinished hotels, dirty tap water and other shortcomings.
More than 150 kilometers (95 miles) of railways, 300 kilometers of roads, a new sewage system and power generating facilities were built for the subtropical city in the run-up to the Olympics, Putin said.
Since 2007, when Russia won its bid for the games, more than 4 million square meters (43 million square feet) of housing and hotel space have been added, according to the Federal Statistics Center and documents from state corporation Olympstroy.
The city still has a long way to got to become a recognized tourist brand in the market, Yuri Barzykin, vice president of the Russian Tourist Industry Union, said last month by phone.
“This year will be decent for Sochi in terms of tourism because there’s big Olympic interest,” Barzykin said. “The troubles will begin when the year ends.”
This year, Sochi will continue to benefit from a Group of Eight Summit in June and a Formula One Championship in October on a new track near the Olympic park. The city will also be a host city for the 2018 World Cup.
“Your and our goal in Sochi shouldn’t be to pump more money in, but to make sure the infrastructure that’s been built works efficiently,” Putin said.
The tens of thousands of hotel rooms and apartments built in the city ahead of the Olympic Games won’t make it easier for Sochi to compete with foreign destinations, Alexei Grachev, head of the city administration’s tourist department, said last month by phone. With demand among Russian tourists unlikely to grow much, caring for excess infrastructure may be a burden, he said.
The city still has a lot of work to do to draw in tourists, Grachev said. Improvements to Sochi’s central beach will cost about 5 billion rubles.
“And big state cash is unlikely to come here anymore,” he said.
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