TOKYO • The decision to delay the Tokyo Olympics until next year means taxpayers and sponsors likely will have to fork over billions more, just as the global economy caves in during the coronavirus pandemic.

On Tuesday, Japanese Prime Minister Shinzo Abe and International Olympic Committee president Thomas Bach agreed on an unprecedented postponement of the event as the world grapples with the Covid-19 disease.

Now, all involved will have to start figuring out the "massive" costs associated with that decision - and who is going to pay them.

Chief of the Tokyo games organising committee, Toshiro Muto, said: "With regards to our revenues, we need to make a lot of effort there... this is going to be a very difficult task that we are facing."

Japan's organising committee said in December the event would cost 1.35 trillion yen (S$17.66 billion), the bulk of which would be covered by themselves and the Tokyo metropolitan government.

The Nikkei newspaper, citing the group, said on Wednesday the delay would trigger about 300 billion yen in additional costs, including venue rentals, rebooking of hotels and additional payments for staff and security guards - but that might be a conservative figure.

A professor at Kansai University, Katsuhiro Miyamoto, recently published an estimate of 422 billion yen in extra costs for a one-year postponement, with another 218 billion yen hit to the economy, excluding any effects from the outbreak.

The organising committee will be seeking more cash from sponsors and the Japanese government, with individual sports associations likely to face financial difficulties, Japan Olympic Committee president, Yasuhiro Yamashita, said on Wednesday.

The amount of funding needed is not known yet, but much of the extra costs likely will accrue from having to retain staff, who otherwise would have been let go once the Games ended.

Mitigating these outlays by putting them on other projects may also will be hard, given the current global economic stagnation.

"The world is not the same as it used to be, so who needs more people right now?" Bent Flyvbjerg, a professor at the University of Oxford, who has written a study of Olympic cost overruns, said.

Maintaining venues that will be empty during the July-September schedule for the Olympics and Paralympics also will be a burden.

Prof Miyamoto estimated that extra care for the 45 venues will cost about 22 billion yen.

Some Olympic facilities are already booked for other events next summer, potentially forcing organisers to pay for alternatives and federations may need to hold extra competitions to select representatives for the Games next year.

Another concern is the fate of the athletes' village, where many apartments have been sold to people expecting to occupy them in 2023.

The contagion also introduces a huge element of doubt in planning for next year and further delays or an eventual abandonment of the Games cannot be ruled out.

Prof Flyvbjerg's research shows that Olympic costs always outstrip estimates - Montreal in 1976 had a 720 per cent overrun.

"If it happened, God forbid, that the Games got cancelled altogether, it would be a huge waste of money," he added.

BLOOMBERG