Well after the fanfare subsides and the fireworks fade, when all the tourists have gone home and the media spotlight has turned its attention to the next big event, what will China have to show for its Olympics extravaganza?

In the early lead up to the Beijing Olympics there was much hype about the economic and cultural benefits the Games would bring to the worlds most populous nation. The Olympics were touted as an opportunity for the West and China to set aside their political wrangling and embrace in a warm all encompassing hug. After all they were launched on the 8th day of the 8th month in 2008, so surely that’s a good omen right?

Well recently there have been rumblings that, the old nasty chestnut, the U.S. subprime mortgage crisis, and the subsequent economic influenza which has swept the world, may be infecting the economic powerhouse that is China, which had long been considered to be bullet proof. Recently numbers showing that industrial output slowed for the month of July to 14.7% from 18.0% a year ago just strengthened concerns that an economic slowdown is taking hold.

Only in the past few days China’s benchmark Shanghai Composite Index, fell even further hitting a 20 month low. So far this year it has been the worst performing sharemarket in the region taking the dubious title from Vietnam.

So what do the experts think will be the lasting legacy of the Beijing 2008 Olympic Games?

According to Austrade’s, Chief Economist, Tim Harcourt, the benefits are there, both in terms of foreign investment in the lead up to the Games and with subsequent business deals which have been secured during the world’s greatest sporting carnival. “Being a part of the Olympics is always good for a country’s brand. It means more people go there and there’s also the boost in infrastructure. For China the legacy of putting on the Olympics will be the benefits of foreign expertise.”

But John Lee, visiting Fellow from the Centre for Independent Studies, is bearish in his views on the Olympic effect, “I don’t think the Games will result in a substantial economic boost for a couple of reasons, one is that Beijing is only responsible for about 3% of China’s GDP. But also China isn’t having problems securing foreign capital. There are figures for example that there’s about 200 billion dollars worth of foreign capital floating around the system in China looking for opportunities. So really there isn’t a foreign capital deficit.”

And Dr. Shane Oliver, Chief Economist at AMP Capital Investments is more pragmatic in his view, “The Olympics is really a showcase for China coming out. It’s more psychological then anything else and will neither cause a boom nor bust. The normal theory is that there is a slump in the host city after the Olympics because of the drop off in construction. But really Beijing is the most insignificant host city in relation to the country. The real issue is that some of the measures of growth across August and September may be affected by factory shut downs aimed at curbing pollution during the Olympics.”

So it seems the jury is still out as to what the lasting impact from the Olympics will be on Beijing and greater China. No doubt there will be some benefits, but when you drag out the abacus and start crunching the numbers whether those benefits are worth the 50 billion dollar price tag remains to be seen.

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