In May, EuroDisney abruptly replaced its CEO. Andre Lacroix, who hailed from Burger King and who was at the job for only two years. He was replaced by Karl Holz, a Disney veteran.

If the sudden change at the top upset shareholders and employees, it was a side issue to EuroDisney which is again fighting for its survival.

The story of the first and only Disney park in Europe is one of never-ending woes. It is also a story that will send a chill down the spines of Hong Kong officials.

For EuroDisney was doing well. Very well indeed. In the words of its chief financial officer Jeffrey Speed, "operationally, no one denied that we had been successful in terms of being the number one tourist destination in all of Europe. Our hotels were running at north of 80 per cent with full-year occupancy on close to 6,000 rooms, and we were generating respectable (cashflow)." Yet EuroDisney had been haemorrhaging cash almost immediately after its grand opening in 1992. In 1994, with losses hitting $1 billion, the Walt Disney Company, which owned 49 per cent of the venture, contemplated bankruptcy.

It was saved by a 13 billion franc rescue package and a new shareholder, the famous Arab investor Prince al-Waleed bin Talal bin Abdulaziz al-Saud, who took a 24.6 per cent stake. Disney's interest was reduced to 39 per cent.

That bought EuroDisney a few good years, during which it made operating profit and became the most popular theme park in Europe, with visitors shooting past the 10 million mark.

But in 2002 it was again in trouble. In fiscal year 2003, it lost €56 million. A year later losses grew to €145 million. EuroDisney was again facing extinction, and a second financial restructuring was needed to push it through 2004.

Today it is still in trouble. The weak dollar has wooed many European tourists away from EuroDisney to the many Disney theme parks in the US. High unemployment in France—which provides 40 per cent of the attendance—and outright recession in other parts of Europe have put a damper on ticket sales. Even Jeffrey Speed admitted that: "to generate our targeted growth over the next several years, we need the economy to co-operate."

This is bad news for the Hong Kong government, which is hoping to use Disneyland to lift up its economy and not the other way round. EuroDisney’s biggest problem is its high development cost. After two rounds of refinancing, today it still owes billions of dollars. Interest payment eats into profit and erodes the theme park’s ability to put up new attractions.

In Hong Kong the same situation prevails. HKITP, the owner of Disneyland, is a 57/43 joint venture between the Hong Kong government and Walt Disney. It borrowed HK$8.4 billion for the park, of which HK$6.1 billion came from the government. Disney itself contributed relatively little to the venture.

To make Hong Kong Disneyland viable, the government has hinted it might have to forgo interest payment. This is by no means its only option. Last year EuroDisney's lenders managed to compel Disney to contribute hugely to the restructuring. Disney complied in order to protect its brand (if the theme park fails it could affect all other Disney ventures globally, from movies and DVDs to TV shows and sale of dolls).

Playing hardball with Disney worked in Europe. It could work in Hong Kong, provided there is sufficient political will to carry it through.