Brazil's political and economic unrest is expected to have serious repercussions for next year's Olympic Games to be held in Rio de Janeiro.

A senior official for the International Olympic Committee, or IOC, predicted the effects of Brazil's current turmoil on Wednesday, The Guardian reported. With the opening ceremony for the Olympics less than eight months away, the country is experiencing severe recession and impeachment proceedings for President Dilma Rousseff, who is encumbered with a huge corruption scandal concerning state-run oil company, Petrobras.

"They have political and economic difficulties," IOC Vice President Craig Reedie said, as quoted by The Guardian. "Inevitably, they will affect the games. There are challenges. I think they and we will have to get through it."

Reedie's statement comes after Rio organizers issued their first progress report to the IOC executive board, which outlined the steps they have accomplished in venue construction over the past year, the news outlet further reported. Majority of the facilities are now ready for South America's first Olympics.

"There has been a massive improvement of the situation in the past months," Reedie said, as reported by The Guardian. "That's good news. Now you have to determine the service levels that athletes and international federations expect."

According to The Guardian, Brazil's economy was flourishing when Rio was awarded the games in 2009, but the nation has been hit with its worst recession since the 1930s. A third of the Brazilian real's value has vanished this year, gross domestic product has fallen, inflation is almost at 10 percent, and unemployment has climbed to nearly 8 percent.

Brazil's economy is expected to contract 3 percent this year and 1 percent in 2016, Financial Times wrote. This deterioration is partly because of a slowdown in China that has diminished the demand for Brazil's commodities exports and reduced tax revenues. Rousseff countered this by implementing incentive measures that included price controls and tax breaks for industry.

Rio organizers are attempting to slash 2bn reals ($530m), or roughly 30 percent, from their operating budget of 7.4bn reals ($1.9bn). Officials said that most of the cuts entail "behind-the-scenes" facilities, The Guardian reported.

"We are in a moment where we need to adjust everything," Rio organizing committee chief, Carlos Nuzman, told reporters in Lausanne, as quoted by The Guardian. "This is normal. All the games are the same. We need to adjust everything and we are doing this with the IOC, the international federations and the NOCs (national Olympic committees)."

Nuzman noted that the most important thing is that "nothing is affected for the athletes, that nothing affects the organization of the games," The Guardian added.