MAY 1, 2002
Why farm subsidies are important in F1
THE subject of government subsidies to farmers may not seem to have that much importance in the high-octane world of Formula 1 but the Formula 1 money supply could be affected because of the tobacco issue.
This week the US Congress will vote on new farm subsidies and if the planned $5bn increase goes ahead, there will be pressure on the European Commission to follow suit because the US farmers will then be able to lower their prices.
European Union Farm Commissioner Franz Fischler said that the payments are really only "concealed export subsidies".
The new US legislation will force Fischler to look again at reforms he is preparing which will restrict EU farm spending to $45m a year. He was expected to reduce crop subsidies as part of the plan. This would have helped his counterparts in Brussels who are trying to vote through a ban of all tobacco advertising in the EU but have no argument against the FIA's assertion that one cannot promote growing tobacco with farming subsidies while at the same time banning the advertising of the products.
The FIA has agreed to introduce a global ban on all tobacco advertising at the end of 2006 and wants Europe to accept that this is the best compromise for all concerned.
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