Osaka city has announced that its total general budget for the 2022 fiscal year, running from April 2022 to April 2023, would be JPY 1.84 trillion (US$16 billion). This is JPY 11.8 billion (US$103 million) more than the previous year’s budget and includes infrastructure costs for both the Osaka-Kansai Japan Expo, scheduled for 2025, and the city and prefecture’s IR bid.
Of the JPY 27.2 billion (US$237 million) estimated for subway and road access to Yumeshima – of which JPY 11.7 billion (US$102 million) will be for the square in front of the new train station gate and JPY 15.5 billion (US$135 million) for widening roads – JPY 5.85 billion (US$51 million) is included in this fiscal year’s budget.
Another JPY 47.70 billion (US$415 million) is earmarked for expenses related to COVID-19 vaccinations and PCR testing.
Osaka city has invested approximately JPY 79 billion (US$687 million) for soil contamination and liquefaction measures for the reclaimed Yumeshima, and it was revealed that the total maintenance costs required before IR development would reach JPY 192.9 billion (US$1.68 billion), double the estimate of one year prior.
Considering the city’s stance was initially to avoid injecting public funds into the IR business, opposition is rising against the city’s massive injection. At the city council plenary session held on 10 February, the LDP (Liberal Democratic Party) and Japanese Communist Party city council groups called for a referendum regarding the pending IR bid and the LDP group submitted a formal referendum ordinance proposal. The ordinance was rejected due to opposition of the Osaka Ishin (Initiatives from Osaka) and Komeito (Clean Government Party).
The initial cost of developing an Osaka IR is currently estimated at JPY 1.08 trillion (US$9.4 billion), with MGM Resorts recently revealing that around JPY 530 billion (US$4.6 billion) of this would be direct investment from its IR consortium and the rest to be procured via financing. Other consortium members include Orix Corp, Kansai Electric Power, Panasonic, Kintetsu Group Holdings and NTT West.
The regional development plan for Osaka’s IR is planned to be approved at both the Osaka prefectural assembly and city council around March, in time for the 28 April submission deadline to the central government.
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