IOC VP: Brazil economic crisis will inevitably affect games

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LAUSANNE, Switzerland (AP) -- The political and economic turmoil in Brazil will "inevitably" affect next year's Olympics in Rio de Janeiro, a senior IOC official said Wednesday, as Brazilian organizers declared that preparations remain fully on track for the games despite the grim financial situation.

With the opening ceremony less than eight months away, Brazil is dealing with severe recession, impeachment proceedings against President Dilma Rousseff and a massive corruption scandal involving state-run oil company Petrobras.

"They have political and economic difficulties," IOC vice president Craig Reedie said. "Inevitably, they will affect the games. There are challenges. I think they and we will have to get through it."

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Reedie spoke after Rio organizers made their latest progress report to the International Olympic Committee executive board. The Brazilians outlined the progress they have made in venue construction over the past year, saying most of the facilities are now ready for South America's first Olympics.

Brazil's economy was booming when Rio was awarded the games in 2009, but the country is now in its worst recession since the 1930s. The real has lost a third of its value this year, gross domestic product has tumbled, inflation is nearing 10 percent and unemployment has soared to nearly 8 percent.

On top of that, Brazil is mired in a spiraling kickback scandal centered on Petrobras, and Rousseff - whose popularity rating has sunk to about 10 percent - is facing impeachment proceedings based on allegations of fiscal irregularities by her government.

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Rio Mayor Eduardo Paes, who has emerged as a central figure in the Olympic project, spoke to the IOC board by video conference from Brazil and briefed the members about the economic problems and the impeachment process.

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IOC VP: Brazil economic crisis will inevitably affect games
This July 27, 2015 aerial photo shows the Rodrigo de Freitas Lake in Rio de Janeiro, Brazil. An Associated Press analysis of water quality found dangerously high levels of viruses and bacteria from human sewage in Olympic and Paralympic venues. The Rodrigo de Freitas Lake, which was largely cleaned up in recent years, was thought be safe for rowers and canoers. Yet AP tests found its waters to be among the most polluted for Olympic sites. (AP Photo/Leo Correa)
In this July 12, 2015 photo, a boy walks with his father's catch of the day from the Marina da Gloria, in Rio de Janeiro, Brazil. The head of Rio's Infectious Diseases Society said contaminated waters in beaches and lakes has led to "endemic" public health woes among Brazilians, primarily infectious diarrhea in children. By adolescence, he said, people in Rio have been so exposed to the viruses in the water their bodies build up antibodies. But foreign athletes and tourists won’t have that protection. (AP Photo/Leo Correa)
This July 27, 2015 aerial photo shows Copacabana Beach in Rio de Janeiro, Brazil. Water quality monitoring was supposed to be beefed up along the city’s picture postcard beaches, including Copacabana, where the marathon swimming competition is to be staged. An Associated Press analysis of the water quality showed the beach waters laden with sewage viruses. (AP Photo/Leo Correa)
In this July 14, 2015 photo, beachgoers wade into the waters of Copacabana Beach in Rio de Janeiro, Brazil. An Associated Press analysis of water quality found not one water venue safe for swimming or boating in Rio's waters. Over 10,000 athletes from 205 countries are expected to compete in next year's Summer Olympics. Hundreds of them will be sailing in the waters near Marina da Gloria in Guanabara Bay; swimming off Copacabana Beach; and canoeing and rowing on the brackish waters of the Rodrigo de Freitas Lake. (AP Photo/Leo Correa)
FILE - In this April 16, 2015 file photo, athletes Diego Nazario, back, and Emanuel Dantas Borges, train in the Rodrigo de Freitas Lake, surrounded by dead small silvery fish, in Rio de Janeiro, Brazil. Despite decades of official pledges to clean up the mess, the stench of raw sewage still greets travelers touching down at Rio's international airport. Prime beaches are deserted because the surf is thick with putrid sludge, and periodic die-offs leave the Olympic lake, Rodrigo de Freitas, littered with rotting fish. (AP Photo/Felipe Dana, File)
In this July 15, 2015 photo, sewage spews into the waters of the Marina da Gloria in Rio de Janeiro, Brazil. Extreme water pollution is common in Brazil, where the majority of sewage is not treated, and much of the raw waste runs through open-air ditches to streams and rivers that feed the Olympic water sites. (AP Photo/Leo Correa)
In this April 28, 2015 photo, Fernando Spilki, virologist and coordinator of the environmental quality program at Feevale University, holds up a water sample, backdropped by the Marina da Gloria, Zone 2, in Rio de Janeiro, Brazil. Spilki said the tests he conducted for the Associated Press so far show that Rio's waters "are chronically contaminated." (AP Photo/Felipe Dana)
This July 27, 2015 aerial photo shows the Alegria Sewage Treatment Plant, located alongside the Guanabara Bay in Rio de Janeiro, Brazil. Starting in 1993, Japan’s international cooperation agency poured hundreds of millions of dollars into a Guanabara clean-up project. The Inter-American Development bank later issued a $452 million loan for more works. A culture of corruption stymied any progress. For years, none of four sewage treatment plants built with the Japanese money operated at full capacity. (AP Photo/Leo Correa)
In this July 28, 2015 photo, a water canal surrounds housing in the Mare slum complex in Rio de Janeiro, Brazil. Extreme water pollution is common in Brazil, where the majority of sewage is not treated, and much of the raw waste runs through open-air ditches to streams and rivers that feed the Olympic water sites. (AP Photo/Silvia Izquierdo)
In this July 9, 2015 photo, doctoral candidate Rodrigo Staggemeier works to analyze samples collected from the waters of Rio de Janeiro, at the Feevale University in Novo Hamburgo, Brazil. The testing conducted for the Associated Press looked for three different types of human adenovirus that are typical "markers" of human sewage in Brazil. The coordinator of the environmental quality program at the university in southern Brazil, said the tests for the AP so far show that Rio's waters "are chronically contaminated." (AP Photo/Leo Correa)
In this July 28, 2015 photo, workers remove garbage collected by floating waste barriers in a canal at the Mare slum complex, in Rio de Janeiro, Brazil. Rio's historic sewage problem spiraled over the past decade as the population exploded with many of the metropolitan area's 12 million residents settling in the vast slums that ring the bay. Waste flows into over 50 streams that empty into the once-crystalline Guanabara Bay. (AP Photo/Silvia Izquierdo)
FILE - In this June 1, 2015 file photo, a discarded sofa litters the shore of Guanabara Bay in Rio de Janeiro, Brazil. As part of its Olympic bid, Brazil promised to build eight treatment facilities to filter out much of the sewage and prevent tons of household trash from flowing into the Guanabara Bay. Only one has been built. Tons of household trash line the coastline and form islands of refuse. (AP Photo/Silvia Izquierdo, File)
In this April 28, 2015 photo, Fernando Spilki, the head of the environmental studies program at Feevale University, takes water samples from the Rodrigo de Freitas Lake, in Rio de Janeiro, Brazil. With little to no sewage treatment, Spilki said, "the quantity of fecal matter entering the waterbodies in Brazil is extremely high. Unfortunately, we have levels comparable to some African nations, to India." (AP Photo/Felipe Dana)
In this June 5, 2015 photo, fetid water flows out of a storm drain that dumps into the Rodrigo de Freitas Lake, where Olympic rowing competitions are slated to be held during the 2016 games, in Rio de Janeiro. Extreme water pollution is common in Brazil, where the majority of sewage is not treated, and much of the raw waste runs through open-air ditches to streams and rivers that feed the Olympic water sites. (AP Photo/Felipe Dana)
This July 27, 2015 aerial photo shows fluorescent green waters in the Marapendi Lagoon, in Rio de Janeiro, Brazil. The lagoons that hug the Olympic Park and which the government’s own data shows are among the most polluted waters in Rio were to be dredged, but the project got hung up in bureaucratic hurdles and has yet to start. (AP Photo/Leo Correa)
In this July 13, 2015 photo, backdropped by Sugar Loaf Mountain, a worker sets up a fence in preparation for an Olympic test event, at the Marina da Gloria, in Rio de Janeiro, Brazil. Over 10,000 athletes from 205 countries are expected to compete in next yearís games. Hundreds of them will be sailing in the waters near Marina da Gloria in Guanabara Bay; swimming off Copacabana beach; and canoeing and rowing on the brackish waters of the Rodrigo de Freitas Lake. (AP Photo/Leo Correa)
In this July 28, 2015 photo, a boy wades in the beach waters of Flamengo, in Rio de Janeiro, Brazil. The Rio Olympic organizing committee's website states that a key legacy of the games will be 'the rehabilitation and protection of the area's environment, particularly its bays and canals" in areas where water sports will take place. (AP Photo/Leo Correa)
In this April 28, 2015 photo, Fernando Spilki, the head of the environmental studies program at Feevale University, holds up water samples taken from the Copacabana Beach in Rio de Janeiro, Brazil. Spilki's testing looked for three different types of human adenovirus that are typical "markers" of human sewage in Brazil. In addition, he tested for enteroviruses, the most common cause of upper respiratory tract infections in the young. (AP Photo/Felipe Dana)
This July 27, 2015 aerial photo, shows Marina da Gloria in Rio de Janeiro, Brazil. Construction is underway on a project to cap a pipe that long spewed raw sewage into the marina, the starting place for the Olympic sailing events. Yet Associated Press testing of the marina's water quality found it laden with sewage viruses. (AP Photo/Leo Correa)
FILE - In this May 20, 2015 file photo, Nawal El Moutawakel, head of the International Olympic Committee's evaluation commission, right, watches Rio de Janeiro's Mayor Eduardo Paes speak during the inauguration of the Olympic Rings at the Madureira Park in Rio de Janeiro, Brazil. Paes has said it's a "shame" the Olympic promises wouldn't be met, adding the games are proving "a wasted opportunity," as far as the waterways are concerned. (AP Photo/Felipe Dana, File)
In this July 16, 2015 photo, members of Austria's Olympic sailing team train in the Rio de Janeiro municipality Niteroi, Brazil. "This is by far the worst water quality we've ever seen in our sailing careers," said Austria's coach Ivan Bulaja. The Austrian sailors take precautions, washing their faces immediately with bottled water when they get splashed by waves and showering the minute they return to shore. (AP Photo/Silvia Izquierdo)
In this July 16, 2015 photo, Ivan Bulaja, coach of the Austrian 49er-class sailing team, speaks during an interview, in the Rio de Janeiro municipality Niteroi, Brazil. The Croatian-born coach said his sailors have lost valuable training days while in Brazil after falling ill with vomiting and diarrhea. "This is by far the worst water quality we’ve ever seen in our sailing careers," said Bulaja, whose team has been sailing in Guanabara Bay, where their competition will take place. (AP Photo/Silvia Izquierdo)
In this July 13, 2015 photo, athletes practice rowing on a deck in the Rodrigo de Freitas Lake in Rio de Janeiro, Brazil. Over 10,000 athletes from 205 countries are expected to compete in next year's Olympics games. Nearly 1,400 of them will be sailing in the waters near Marina da Gloria in Guanabara Bay; swimming off Copacabana Beach; and canoeing and rowing on the brackish waters of the Rodrigo de Freitas Lake. (AP Photo/Leo Correa)
In this Nov. 7, 2015 photo, a bird carcass lies on the shore of Copacabana Beach in Rio de Janeiro, Brazil. Rio won the right to host the 2016 Olympics based on its bid that promised to clean up the city's waterways by improving sewage sanitation, a pledge that meant to be one of the event's biggest legacies. Brazilian officials now acknowledge that won't happen. (AP Photo/Leo Correa)
In this Nov. 5, 2015 photo, workers remove garbage collected by floating waste barriers in the Meriti River, which flows into Guanabara Bay in Rio de Janeiro, Brazil. A new round of testing by The Associated Press shows the cityâs Olympic waterways are as rife with pathogens far offshore as they are nearer land, where raw sewage flows into them from fetid rivers and storm drains. . (AP Photo/Silvia Izquierdo)
In this Nov. 5, 2015 photo, trash collects against floating waste barriers in the Meriti River, which flows into the Guanabara Bay, in Rio de Janeiro, Brazil. Rioâs waterways, like those of many developing nations, are extremely contaminated because most of the cityâs sewage is not treated, let alone collected. Massive amounts of it flow straight into Guanabara Bay. (AP Photo/Silvia Izquierdo)
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"'He gave a number of reassurances that the general public still supports the games, by a high percentage," said Christophe Dubi, the IOC's executive director of the Olympic Games. "He provided reassurance that every effort will be made to make sure these game are organized without any major impact coming from the current economic situation."

Rio organizers are trying to cut 2 billion reals ($530 million), or almost 30 percent, from their operating budget of 7.4 billion reals ($1.9 billion). Rio officials say most of the cuts involve "behind-the-scenes" facilities.

"I think the most important thing is that nothing is affected for the athletes, that nothing affects the organization of the games," Rio organizing chief Carlo Nuzman told reporters in Lausanne.

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The IOC is discussing separately what steps it can take to reduce the spending in Rio, including possible reductions in food services, transportation and seating for Olympic officials. No bailout is being considered.

Dubi said the IOC has set up a working group to look at ways of cutting "fat" from the budget.

" Everywhere we can make savings, we will make savings," he said.

The IOC also asked Brazilian organizers about the severe water pollution in Rio that affects the sailing, rowing and canoeing venues. A new round of testing by The Associated Press found the waterways being used for the Olympics are more widely contaminated by sewage than previously known.

"I explained we are following the World Health Organization, following what they establish," Nuzman said. "We are testing. The athletes, the NOCs, the large majority are very happy."

Reedie said: "There are ways of stopping refuse from getting into the water. They are talking about taking steps to do that."

In other developments:

- The IOC board approved the cycling venues for the 2020 Tokyo Olympics, including moving indoor track events to a facility located two hours from the host city.

Officials said moving track cycling to an existing velodrome in Izu would save $100 million in construction costs, bringing to $1.8 billion the total savings from a series of venue changes for the games.

- The IOC sharply criticized Kuwait, saying the situation has gotten worse since the Gulf country was suspended from the Olympic movement in October for government interference.

Patrick Hickey, the IOC's point man on issues of autonomy, said Kuwait's sports minister has made the dispute "very personal" and "is not seeing reality."

Kuwait is threatening to ban athletes from taking part in upcoming international sports events and to shut down the headquarters of the Olympic Council of Asia, Hickey said.

- The IOC said three potential Olympic athletes have been identified so far from among the wave of refugees and migrants from troubled countries.

The IOC has pledged $2 million to help refugees, and is asking authorities in refugee camps to identify any top-level international athletes.

Pere Miro, the IOC's deputy director general for relations with the Olympic movement, said the committee would offer funding and training to help athletes qualify for Rio.

So far, he said, the list includes a female swimmer from Syria now in Germany, a male judo competitor from Congo in Brazil, and a female taekwondo competitor from Iran in Belgium.

- Two-time Olympic pole vault champion Yelena Isinbayeva of Russia is among 24 candidates to become an IOC athlete member. Four athletes will be elected to the IOC during the Rio Games.

The IOC said Isinbayeva is eligible to seek election, even though Russian track and field athletes are currently banned from international competition following allegations of state-sponsored doping in the country. The IOC said Isinbayeva can be a candidate because she has competed in past games.

Other candidates include Ukraine's Nataliya Dobrynska, the 2008 Olympic champion in the heptathlon; Japan's Koji Murofushi, 2004 silver medalist in the hammer throw; and two-time gold medalist sailor Robert Scheidt of Brazil.

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