MAY 23, 2006
Oh, Russia again
There is no doubt that Formula 1 teams want to try to get Russia on the calendar at some point in the future. The logic for this is very simple as the Russian Federation boasts a population of 143m and it is estimated that there is a middle class numbering between 10m and 30m which accounts for up to 60% of all consumer spending. Russia's middle class is difficult to define in that a great deal of business in Russia is still being done under the table to avoid taxes. Whatever the case, the country has averaged growth of 6.4% annually since the financial crisis of 1998. This has been due to strong earnings from oil exports and thanks to the low value of the ruble although consumer spending has increased as the middle class has expanded. The country wants to attract more foreign investment but investors remain cautious because of the difficult market situation, corruption and a widespread distrust of the institutions. The reports that billionaire Roman Abramovich is discussing plans for a racing circuit with Moscow's Mayor Yuri Luzhkov are not unusual but nothing has yet come of such talk and there is really no sign that it will.
If Luzhkov was serious about a race, the logical thing to do would be to talk to Alex Shnaider of the Midland Group. Shnaider has close links with the Moscow municipal government having been behind the developments in the Arbat district and has a deal to develop a system of 79 overhead pedestrian crossings through the city, each with space for retail outlets. These multifunctional overpasses will combine business, entertainment and shopping areas. The company has a deal until 2019 to operate containers for selective collection of municipal waste and will use these to advertise as well as collect rubbish. Midland is also involved in development of old industrial areas of the city which would make it an obvious group to be involved in an F1 circuit project.
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