Izvestia looks into the progress of construction of the Olympic facilities.
Not everyone is allowed into the construction site for the Olympic venues in the Imereti Valley: This huge area is surrounded with barbed wire fences. And the news coming from the restricted area has been controversial. In early April, the Olympstroi State Corporation criticised Oleg Deripaska's companies for deranging the building of Sochi Airport. Last Thursday IOC delegates came to Sochi and were amazed. Izvestia decided to find out why they were so impressed.
Criticising the progress of construction for the Olympics has become commonplace. The reasons are predictable. Natural areas have been destroyed. People are offended. And on top of that the region has been plundered. It was reasonable to expect something mean from the IOC visit especially because the delegation was headed by Jean-Claude Killy, who is known for his disapproval of Russia' initiatives. Prime Minister Vladimir Putin, who usually flies to Sochi to meet the guests himself, limited himself to a meeting by video conference this time. For many, as Killy said the first words, it seemed like a dream.
"We are deeply impressed with what we have seen. The committee is satisfied with the course of construction", Killy said. "It is proceeding ahead of schedule and the progress is incredible."
He concluded, "We have seen everything that Russia promised to show." In response, Putin said the country plans to spend 60 billion roubles ($1.89 billion) on the construction (50% funded by the government and 50% funded by private investors). There are 43 venues currently under construction, and another 153 are being designed. But the most sensational news (there was no way the critics expected this) was Putin's promise to hold the first competitions next year. Earlier, many thought that Russian athletes would not have the opportunity to train properly for the Olympics because construction was not on schedule.
However, the sensation emerged two weeks before Killy's visit. Delegates from the International Ski Federation inspected the Rosa Khutor alpine ski resort (one of only a few places worth visiting by now) and set up the courses for the European Cup to be held in February 2011.
"I have absolute confidence that the remaining work on the courses and the artificial snow system will be finished on time and that Rosa Khutor will host major international events. We plan to return here in autumn to settle all the remaining formalities," Atle Skaardal, FIS Chief Race Director for the FIS World Cup in Women's Alpine Skiing, said setting the tone for Killy's speech.
It is easy to say something positive about Rosa Khutor (construction supervised by Vladimir Potanin's companies). But the bobsled and luge track is being criticised by both lugers and bobsledders. Leaders of sports associations are grumbling that they were not consulted about the design. There are also complaints that the track seems to be "too slow". The tracks in Vancouver allowed lugers and bobsledders to accelerate to a speed of 150 km/h. (By the way, this cost a Georgian athlete his life.) In Sochi, the maximum speed will be 135 km/h. In the heat of the argument everyone seemed to forget that the contractor was chosen only in March and the former deadline set for 2011 will now have to be shifted. However, Deputy Prime Minister Dmitry Kozak assured that the track will be finished by March 2012, the first test competitions will take place in summer, and the first real competitions are planned for October. Can this be regarded as success? It certainly can.
But success will not come so easily. The businesses that rushed to tap the Olympic budgets soon became punching bags for all sorts of the authorities. However, the entrepreneurs proved to be strong. They know that there is a price for everything. There are few cases of voluntary withdrawal from the Olympic projects and these smack of blackmail. Aluminium tycoon Oleg Deripaska is criticized more often than others. Last December Prime Minister Putin claimed that the oligarch should take responsibility for the destruction, during a severe storm, of the Mzymta cargo port currently under construction. Now Olympstroi has made a claim regarding the construction of Sochi International Airport (also owned by Deripaska). The claim is actually a warning because the deadline has been missed. There was a promise to open it on March 31 but the promise remained on paper.
The airport is in fact the one that was presented to the IOC commission back in 2007 as a completed facility. Opponents of the project claimed that to give the impression that the airport was operating locals were invited to come with the nicest luggage they had to look like passengers. However, we cannot be sure that this really happened. We do know that failure to meet the deadline for more than ten days is punishable with a fine. Claiming unidentified sources, the media even announced the size of the fine – five million roubles. As of today there have not been any fines imposed on Deripaska.
I wonder if Telman Ismailov ever hears something like, "Wow, that is huge like Cherkizon! (an open-air consumer market in Moscow owned by Ismailov)." When the notorious market was demolished Ismailov decided to start a new life from scratch and promised to build 4,000 hotel rooms in Sochi (the actual demand is over 40,000 but it is nevertheless an impressive promise). And it is a relief for the officials. They believe that Ismailov will help resolved their problems with accommodations. But it has been difficult to get any information about the course of construction. Izvestia was assured that surveys have been completed and the design is being developed.
Why is everything progressing so slowly? Officials claim that "there are objective reasons." Environmentalists keep whining that the roads are bad and there is no good port. And there is the crisis on top of all of this. And this is true, but it's not the full story.
The government developed an interesting financing scheme to encourage businesses. Selected contractors (the major ones) have received cheap loans from Vnesheconombank under guarantees from Olympstroi. The loan interest rate is the lowest possible – the refinancing rate of the Central Bank (8.25%) plus 0.4-1.4%. So the markup is minimal. It is a bonanza to the businesses. But there is another thing, still more profitable – lending the money to some contractor with a better interest rate. After all, the Olympic Games are still far ahead. No one has been accused of taking advantage of this system yet. Well, no one tried because the financing scheme was unveiled only recently.
Despite all of these problems, it is now clear that the facilities will be finished as planned, even if it is done in "the Russian way."
Yevgeny Aronov