Pusan Asian Games Humiliating Backstage Concession

The Board of Audit and Inspection (BAI) found that, as the 2002 Pusan Asian Games Organizing Committee was driven to the critical situation which is likely to lose the right to host by the breach of `the host city contract`, it made a disadvantageous clandestine contract with the Olympic Council of Asia (OCA) only to bring upon the waste of budget.

According to the BAI`s inspection yesterday, the Pusan Asian Games Organizing Committee had signed a contract under which the organizing committee deposited only 1 million dollars to the OCA, and could not launch any independent fund- raising businesses. But the committee signed contracts of total 12.4 billion won with four Korean companies for the use of the Asian Games emblem, so that the OCA has threatened a few times to deprive the organizing committee of the right to host the Asian Games.

But the organizing committee did not properly respond to the OCA`s warnings, and finally the OCA notified the committee to strip of the right to host the Asian Games, to bring an action for damage against the committee, and to confiscate the deposited 1 million dollars on Aug. 30th last year, unless the committee take the satisfactory solutions within 60 days.

As the situation became more serious, the organizing committee signed a `Sydney agreement` on Sep. 16 last year, under which the OCA would have all rights to pursue the business related to the Asian Games, the committee would offer expenses for flights and hotel accommodations for about 1,500 foreign participants in the Games, and would deposit another 20 million dollars at a commercial bank to guarantee such agreements.

Due to such an unnecessary additional negotiation, the organizing committee spent 565,480,000 won from the reserve fund, deposited 20 million dollars at Shanghai Bank in Hong Kong, and paid 89,760,000 won for the certificate issue.

In particular, the BAI pointed out that in spite of the financial difficulties, the organizing committee agreed with the OCA to recover 10 million dollars among the deposit of 20 million dollars after a successful end of the Pusan Games only to worsen the financial situation.

And by the negligent negotiation, the organizing committee agreed to offer 45.3 percent of all its income to the OCA, 12 percent larger than 33.3 percent set by the OCA charter so that it would have to present additional 6.1 billion won to the OCA.

An official of the BAI said, ``Bangkok of Thailand offered only 20 percent of its income, far lower than the shares set by the OCA charter, and earned 80 percent.``

Regarding the BAI`s inspection, the organizing committee explained ``since 20 million dollars was deposited by name of the committee, the OCA is not able to withdraw at its own will. And if we truly follow the contract, we can recover the whole amount. We never promised to give even 10 won more in `the Sydney Agreement` .``

Boo Hyung-Kwon bookum90@donga.com