LAUSANNE, Switzerland (AP) The political and economic turmoil in Brazil will ''inevitably'' affect next year's Olympics in Rio de Janeiro, a senior IOC official said Wednesday, as Brazilian organizers declared that preparations remain fully on track for the games despite the grim financial situation.
With the opening ceremony less than eight months away, Brazil is dealing with severe recession, impeachment proceedings against President Dilma Rousseff and a massive corruption scandal involving state-run oil company Petrobras.
''They have political and economic difficulties,'' IOC vice president Craig Reedie said. ''Inevitably, they will affect the games. There are challenges. I think they and we will have to get through it.''
Reedie spoke after Rio organizers made their latest progress report to the International Olympic Committee executive board. The Brazilians outlined the progress they have made in venue construction over the past year, saying most of the facilities are now ready for South America's first Olympics.
Brazil's economy was booming when Rio was awarded the games in 2009, but the country is now in its worst recession since the 1930s. The real has lost a third of its value this year, gross domestic product has tumbled, inflation is nearing 10 percent and unemployment has soared to nearly 8 percent.
On top of that, Brazil is mired in a spiraling kickback scandal centered on Petrobras, and Rousseff - whose popularity rating has sunk to about 10 percent - is facing impeachment proceedings based on allegations of fiscal irregularities by her government.
Rio Mayor Eduardo Paes, who has emerged as a central figure in the Olympic project, spoke to the IOC board by video conference from Brazil and briefed the members about the economic problems and the impeachment process.
''`He gave a number of reassurances that the general public still supports the games, by a high percentage,'' said Christophe Dubi, the IOC's executive director of the Olympic Games. ''He provided reassurance that every effort will be made to make sure these game are organized without any major impact coming from the current economic situation.''
Rio organizers are trying to cut 2 billion reals ($530 million), or almost 30 percent, from their operating budget of 7.4 billion reals ($1.9 billion). Rio officials say most of the cuts involve ''behind-the-scenes'' facilities.
''I think the most important thing is that nothing is affected for the athletes, that nothing affects the organization of the games,'' Rio organizing chief Carlo Nuzman told reporters in Lausanne.
The IOC is discussing separately what steps it can take to reduce the spending in Rio, including possible reductions in food services, transportation and seating for Olympic officials. No bailout is being considered.
Dubi said the IOC has set up a working group to look at ways of cutting ''fat'' from the budget.
'' Everywhere we can make savings, we will make savings,'' he said.
The IOC also asked Brazilian organizers about the severe water pollution in Rio that affects the sailing, rowing and canoeing venues. A new round of testing by The Associated Press found the waterways being used for the Olympics are more widely contaminated by sewage than previously known.
''I explained we are following the World Health Organization, following what they establish,'' Nuzman said. ''We are testing. The athletes, the NOCs, the large majority are very happy.''
Reedie said: ''There are ways of stopping refuse from getting into the water. They are talking about taking steps to do that.''
In other developments:
- The IOC board approved the cycling venues for the 2020 Tokyo Olympics, including moving indoor track events to a facility located two hours from the host city.
Officials said moving track cycling to an existing velodrome in Izu would save $100 million in construction costs, bringing to $1.8 billion the total savings from a series of venue changes for the games.
- The IOC sharply criticized Kuwait, saying the situation has gotten worse since the Gulf country was suspended from the Olympic movement in October for government interference.
Patrick Hickey, the IOC's point man on issues of autonomy, said Kuwait's sports minister has made the dispute ''very personal'' and ''is not seeing reality.''
Kuwait is threatening to ban athletes from taking part in upcoming international sports events and to shut down the headquarters of the Olympic Council of Asia, Hickey said.
- The IOC said three potential Olympic athletes have been identified so far from among the wave of refugees and migrants from troubled countries.
The IOC has pledged $2 million to help refugees, and is asking authorities in refugee camps to identify any top-level international athletes.
Pere Miro, the IOC's deputy director general for relations with the Olympic movement, said the committee would offer funding and training to help athletes qualify for Rio.
So far, he said, the list includes a female swimmer from Syria now in Germany, a male judo competitor from Congo in Brazil, and a female taekwondo competitor from Iran in Belgium.
- Two-time Olympic pole vault champion Yelena Isinbayeva of Russia is among 24 candidates to become an IOC athlete member. Four athletes will be elected to the IOC during the Rio Games.
The IOC said Isinbayeva is eligible to seek election, even though Russian track and field athletes are currently banned from international competition following allegations of state-sponsored doping in the country. The IOC said Isinbayeva can be a candidate because she has competed in past games.
Other candidates include Ukraine's Nataliya Dobrynska, the 2008 Olympic champion in the heptathlon; Japan's Koji Murofushi, 2004 silver medalist in the hammer throw; and two-time gold medalist sailor Robert Scheidt of Brazil.