16 February 2016

Why football is moving east

Gazza’s time in China was a harbinger of big changes.

(Photo By SOCCER WEEKLY/PRESS ASSOCIATION IMAGES)

In late 2002, Paul Gascoigne made the curious decision to try to extend his football career in China. During his brief stay, he ate “a lot of bat” and fished for koi carp in the hotel pond using the needle and thread from a sewing kit. “I caught one,” he later wrote. “I blew a kiss to the heavens and fell to me knees.”

Gazza was having a lark, because Chinese football was a bit of a joke by global standards. When I visited the country three years later, to report a sports story, its then 14-team Super League was so tainted by corruption and fan violence that it had failed to attract a headline sponsor. The idea that it could attract an international footballer in his prime – Gazza was hardly that – was remote.

A decade on, nobody is laughing at the Chinese league. During the January transfer window, Chinese football clubs outspent those in the Premier League, the world’s richest. In ten days, the country’s transfer record was smashed three times, culminating in Jiangsu Suning paying £38m for the Brazilian striker Alex Teixeira. Speaking afterwards, Arsenal’s manager, Arsène Wenger, said British clubs should be concerned. China now appeared to have “the financial power to move a whole league of Europe” to the East.

So, what lies behind the splurge? Like so many things in China, it starts at the top. President Xi Jinping is a big fan of football – the number-one spectator sport in China – and wants the country to become a powerful footballing nation. In 2011, he expressed “three wishes” for China: to play in the World Cup again, to host the tournament and to win it.

The government’s high-profile programme to boost the sport has created optimism in China about the future of the domestic game. It has also attracted the attention of tycoons and companies whose desire to curry political favour outweighs any concerns about the slowing economy. Many of the leading Chinese clubs have now been acquired by huge corporations. Last season’s champions, Guangzhou Evergrande, coached by the former Brazil boss Luiz Felipe Scolari, is owned by a large real-estate company, with the internet giant Alibaba also holding a 40 per cent stake. The runners-up, Shanghai SIPG, led by the former England coach Sven-Göran Eriksson, belongs to the city’s ports group. Jiangsu, Teixeira’s new club, was bought by an electronics retail chain in December.

Besides competing for the best talent in Europe, Chinese teams have raided the Brazilian premier league. Last month, four players from the reigning champions, Corinthians, were bought by Chinese clubs.

Few experts expect the spending to stop soon. Fewer still think it will end well. While Chinese clubs are spending similar sums to the richest European teams on their stars – and ploughing vast quantities of cash into state-of-the-art academies – their broadcast and ticket revenues are tiny by comparison.

“The spending is astonishing and not sustainable in the long term,” says John Yan, a sports commentator in China. “There’s definitely a bubble.”

The world’s biggest clubs are watching closely, as China’s commercial interest extends beyond players. In December, a few weeks after Xi visited Manchester City’s training ground with David Cameron, a Chinese consortium paid £275m for a 13 per cent stake in the Abu Dhabi-owned company that holds the club. In January, China’s biggest private property group, Dalian Wanda, spent £35m on a 20 per cent stake in Atlético Madrid. More deals involving top European clubs are expected to follow.

“There’s a massive landgrab going on for sports properties,” says Daniel Fletcher, a director of FMMI, a British sports consultancy working in China. “It’s not a one-off.”