Spanish Prime Minister Mariano Rajoy told IOC inspectors on Monday that much of the infrastructure needed for Madrid's 2020 Olympic bid is already built, emphasising a low-cost approach at a time of financial austerity.
Rajoy welcomed the IOC's evaluation commission at the start of its four-day inspection of Madrid, which is competing against Tokyo and Istanbul.
"Madrid has a great advantage: 80 per cent of the sports facilities needed to hold an Olympic Games are already built,'' Rajoy said.
Spain's government has thrown its weight behind the bid, although the country is immersed in a deep financial crisis and has an unemployment rate of 26 per cent.
Rajoy said Madrid was accustomed to hosting major events and Spain already welcomes 58 million visitors each year as one of the world's favourite tourist destinations.
With Spain's economy mired in its second recession in three years, thrift is the byword of Madrid's bid.
The bid committee said 28 of the 35 proposed venues are already built, and that its budget to finish preparations is a modest $1.9 billion, plus an additional $192 million for security costs.
The IOC panel has already visited Tokyo and will travel to Istanbul next week. The full International Olympic Committee will select the host city in Buenos Aires on September 7.
Madrid is bidding for a third straight time after losing to London for the 2012 Olympics and Rio de Janeiro for the 2016 Games, and the budget figures have been trimmed from the previous campaigns to reflect Spain's reduced means.
The country has the European Union's highest unemployment rate, and Rajoy's government is part-way through implementing one of the Euro bloc's most stringent austerity programs.
As the government has cut the size of the country's welfare state, Spain has been rocked by public protests, large demonstrations and strikes.
The capital's transport system is expected to suffer partial strikes on Tuesday and Wednesday and three demonstrations are planned to coincide with the IOC visit, one of which is due to be held near the site of the future Olympic stadium.
Five of the 14 IOC panel members who will review Madrid's venues, finances and security plans during the four-day tour were here during the previous bids.
This time, inspectors will find new additions to already existing venues, such as the inclusion of the city's Las Ventas bullring - scene of sporting events such as tennis or fencing going back to the 1920s - the Retiro park and Real Madrid's Valdebebas training facilities.
Some venues, however, such as the 65,000 capacity La Peineta stadium for track and field events and the Aquatic (water sports) Centre, are only part finished.
Construction on the 18,000-capacity aquatic centre began in 2004 but was halted in 2005. The bid's dossier states that work is due to resume in June 2014 for completion in June 2016.
La Peineta was built in 1994 and is scheduled to continue undergoing "renovation'' until June 2015, although most observers say this date is likely to be exceeded.
"Our plans are for La Peineta to be transformed into a modern sports venue in time, and then later to be handed over to Atletico Madrid football club as its new main stadium,'' Alejandro Blanco, president of the Spanish Olympic Committee, told The Associated Press.
Both La Peineta and the Aquatic Centre are listed as existing facilities.