It wasn't surprising that Tokyo was chosen over other candidate cities in the bid for the 2020 Olympics. Tokyo ranked highest in sports facilities, urban infrastructure and public support and, unlike Madrid or Istanbul, it isn't facing any strong economic or political uncertainties.

Since Shinzo Abe stepped up last December, he has put Japan on a regime of Abenomics, a mix of bold and flexible financial policies aimed to revive a stagnant economy. His policy has proved effective as stocks rocketed and the yen dropped. Tokyo's successful bid for the 2020 Olympics will no doubt earn even more support for the prime minister.

Although Abe's economic policy seems to be working at the moment, we should also see its negative effects.

Japan is running a record 1,000 trillion yen ($10 trillion) in public debt. Hosting the Olympics will no doubt put Japan deeper in debt, straining the economy.

Based on an editorial from the International Finance News.