NOVEMBER 24, 2005
Why the Belgian Grand Prix will happen
It is no fun being a Belgian politician at the moment. The contract that exists between the government of Wallonia and Formula One Management leaves the new regional premier Elio di Rupo, who has been in office for just a few weeks, with a major problem. The contract, agreed between the previous administration and FOM, means that the government must pay race fees until 2010 and perhaps even until 2015, which critics say leaves the government facing a potential bill of at least $80m, which may rise to double that amount. The current cost is around $13m a year but in normal FOM contracts that increases annually by 10%.
In the circumstances the only logical course of action is for the government to run the race and try to reduce the losses, although in recent years the annual loss has been in the region of $4m. Given the fact that losing $20m over five years is less painful than losing $80m the race will presumably go ahead in the hope that better promotion will reduce the losses and, in the case of a miracle, will actually turn a profit. It might even be worth the locals investing money in a Belgian driver in the hope that national fervour might lead to higher ticket sales, although given the current situation the new administration may not feel in a risk-taking mood.
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