The winds of change blowing across the Northern Sahara all but demand a look at foreign operations disclosures, particularly as many companies are deeply entrenched in preparing this year’s annual reports. Political risk has many guises—war, expropriation, currency devaluation—but for companies doing business abroad, these risks don’t begin to give a complete picture of potential threats to earnings. Just six weeks into 2011, a number of well-known companies have already provided a glimpse of what’s keeping their board members awake at night.Just two days ago, I discussed the Bahrain Grand Prix as just the sort of Western-sponsored event at risk in the region. (While watching the BBC, the commentator mentioned that the kingdom spent £25 million to host the 2011 race plus another £11 million for having the first race of the season. These come on top of £92 million to build the Sakhir race track.) Appropriately enough, perhaps, the first race on the Formula One calendar in the now-tumultuous country of Bahrain has been called off. As per my previous post, the race scheduled for March 13 has been cancelled. So, the first race of the year will now be the traditional season opener of year's past--Melbourne on the 27th of March. From the official site:
The Bahrain International Circuit (BIC) today announced that the Kingdom of Bahrain would withdraw from hosting this year’s F1 Grand Prix race so that the country can focus on its process of national dialogue. Last Friday, Bahrain’s Crown Prince - HRH Prince Salman bin Hamad Al-Khalifa - initiated a new national dialogue involving all sections of Bahraini society in order to resolve the current political situation in the Kingdom. The Crown Prince informed Formula One’s Bernie Ecclestone of the BIC’s decision by telephone earlier today.So it may still be moved to a later date in the 2011 calendar. In the meantime, I guess the BBC read it right: rather than risk a black eye for both the sport and the country by going on as if nothing happened, those concerned have taken the prudent course of action. For, sports and politics are bound together:
HRH Prince Salman said: “At the present time the country’s entire attention is focused on building a new national dialogue for Bahrain. “Although Bernie Ecclestone had graciously made clear that a decision on the race was entirely Bahrain’s to make and was not yet required, we felt it was important for the country to focus on immediate issues of national interest and leave the hosting of Bahrain’s Formula 1 race to a later date.
“I would like to extend my personal gratitude to Bernie Ecclestone for his support and understanding. After the events of the past week, our nation’s priority is on overcoming tragedy, healing divisions and rediscovering the fabric that draws this country together; reminding the world of the very best that Bahrain is capable of as a nation once again united.
Chairman of the Bahrain International Circuit, Zayed R. Alzayani said: “Bahrain’s Grand Prix is a time of celebration and hosting the race is a source of great pride for Bahrain and Bahrainis. It is a showcase to the world and we look forward to welcoming the teams and drivers and everyone involved in Formula One back to Bahrain in the very near future. I hope that F1 and our friends around the world will understand our decision at this difficult time.”
Following the Crown Prince’s decision, Bernie Ecclestone commented: “It is sad that Bahrain has had to withdraw from the race, we wish the whole nation well as they begin to heal their country. The hospitality and warmth of the people of Bahrain is a hallmark of the race there, as anyone who has been at a Bahrain Grand Prix will testify. We look forward to being back in Bahrain soon.”
No decision has been made on a new date for the rescheduling of the race, which was due to take place from March 11th to 13th.
Sport matters to us because of the release it provides. At its grandest, it can unite and liberate. But the sporting powers cannot have it both ways. They cannot celebrate their reach and importance when it is convenient and then wish somehow that they could be left alone to get on with their competitions when it is not. Should Bahrain still be in ferment come the beginning of March, then Ecclestone's decision will - whether he likes it or not - be making a statement which will resonate down the Arab street.