The Circuit of Wales project "has taken a major hit" after the Welsh Government decided against offering the financial guarantee needed to build the prospective British MotoGP venue, according to Mitchell & Benyon of MOTORSPORT. Welsh Economy & Infrastructure Cabinet Secretary Ken Skates released a written statement on Tuesday confirming the government was "rejecting the proposal" presented by heads of the £433M ($554M) project in April. The request asked that the government "enter into a guarantee of a loan facility of £210million provided by [major project backer] Aviva Investors." Since then, due diligence has been taking place into "how many jobs the project, planned for the Ebbw Vale region, would create and how much value it would bring to the local economy." With due diligence now complete, Skates said that "the potential impact on the public finances of the current proposal before them was too great." He added that claims of 6,000 potential jobs were "significantly overstated," and by '24, the expectation would be "little over 100" direct full-time positions (MOTORSPORT, 6/27). The BBC reported the developers "strongly disagreed" with the decision and "the rationale behind it." Ministers said that a £100M ($128M) automotive business park "would be built instead." First Minister of Wales Carwyn Jones said that backing the scheme "would mean schools and homes would not be built." The issue of the guarantee meant the Welsh Government would have received £99M ($126.7M) over 33 years "in exchange for underwriting the project once it was open for business." But in the event of it failing, the public purse would have to pay back £210M ($269M) over time, while insurance firm Aviva "would keep the circuit and the infrastructure" (BBC, 6/27).
