Compiled by ALEX BIVOL, ELITSA SAVOVA, SPASENA BARAMOVA and SVETLANA GUINEVA

When Pierre de Coubertin, father of the modern Olympics, began promoting the idea of resurrecting the ancient Games, his goal was to promote sport as an important part of the education of youth in his day. More than a century later, the Games have grown to become the main sports event of the year, but also a booming industry.

The 12 global sponsors of the International Olympic Committee pay $100 million for the right to partner the IOC in each Games cycle, while each host city has the right to pick between 10 and 15 national sponsors and sign separate multi-million contracts with each one. The list of global sponsors includes McDonald’s, Panasonic, Samsung, Visa, Kodak, General Electric and Coca-Cola, the longest standing partner since becoming the first ever sponsor of the Olympics in 1928.

With the Chinese market booming in the past decade, the Beijing Olympics are especially important for advertisers, giving them an opportunity to step up or consolidate their presence in one of the world’s biggest markets. Not even the controversies surrounding China’s human rights record or crackdowns on political dissidents have managed to put a dampener on sponsors’ interest. The opportunity proved too enticing to pass up and the IOC has collected a record high $4.4 billion in sponsorship and TV rights money over the four-year period that covers both the 2006 Winter Olympics in Turin and the Beijing Games, Forbes reported.

For host cities and countries, it is a chance to drastically improve their image not only from a political point of view, as is the case with China, which is using the Games to establish itself as a global player, but economically as well. Barcelona, which hosted the 1992 Olympics, has used the opportunity to reshape entire parts of the city, while Sydney is now recognised as a true global city after hosting the 2000 Games.

Both cities benefited, in terms of tourist inflows, long after the Olympics ended, but it can be a losing gamble as well. It is well documented that Montreal only finished paying off the debt incurred by hosting the 1976 Games three decades later, while Athens, the 2004 host, saw final costs balloon to 10 times the initial estimate and more than double the initial plans envisioned.

China is going even further, spending $42 billion on sports venues and adjoining infrastructure, triple the amount that was spent in Athens. It is an amount that the world’s third biggest economy can afford without feeling any major repercussions and a small price to pay for enhancing its reputation as one of the key global markets.