Rio Declares State of Financial Emergency Before Olympics

By Lise Alves, Senior Contributing Reporter

SÃO PAULO, BRAZIL – On Friday, Rio de Janeiro’s acting governor, Francisco Dornelles, alarmed international media by declaring a financial emergency in the state. However Rio’s mayor, Eduardo Paes assured reporters on Sunday that the current financial crisis faced by the state will have no affect on the 2016 Olympic Games, scheduled to start in the city in less than 45 days.

“The crisis of the state has nothing to do with the Olympics. It affects zero of the Games,” said Paes during the inauguration of the Via Expressa Tunnel. “What [financial crisis] affects is the rendering of services.

Local media has been reporting that the federal government is expected to announce this week financial aid, to help the city maintain its security agents, public transportation and state public services going during the Olympics.

Interim President, Michel Temer, told reporters last week that the federal government would be willing to support financially for the success of the Rio 2016 Games. Analysts forecast that the city will receive more than a half a million visitors during the August 5-21st Olympics and September 7-18th Paralympics.

Yet according to Dornelles due to the extremely serious financial crisis, the state may not be able to comply with all of its obligations during the Olympic and Paralympic events. The text released by the state government talks about the possibility ‘of a total collapse in public security, health, education and mobility’ in the next few months.

Finance officials in Rio estimate that the deficit for this year in the state will be approximately R$19 billion. “If it was a company, the first thing to do would be to request financial recovery (similar to the U.S.’s Chapter 11),” said finance secretary Julio Bueno last week.