Chinese Football, More Than a Game
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Syndicated articles from In partnership with © The Financial Times Limited 2016. All Rights Reserved. Not to be redistributed, copied or modified in any way. Edition 2530 FT | 04 Apr 2016 Chinese football, more than a game By Ben Bland Ukraine’s Shakhtar Donetsk and Charles Clover XINHUA for USD55m in February. It was the third time in a mat- My life in China hasn’t real- ter of days that the national ly started yet,” says Gervin- transfer record had been ho with a nervous laugh. broken and Jiangsu report- “But Chinese football has edly beat English Premier huge growth ahead of it (…) League side Liverpool to many friends in the football sign Teixeira. world have congratulated Chinese clubs have had to me and told me they want to pay big transfer fees and of- join me here.” fer some of the highest sala- In a country more famed ries in the football world, a for its exports than its im- move that threatens dramat- ports the 28-year-old Ivo- ically to alter the dynamics rian footballer is one of the of the global transfer mar- unlikely faces of a new Chi- ket, according to industry nese revolution - one that observers. aims to bring the world’s Edward Woodward, ex- biggest game to the world’s ecutive vice-chairman largest audience. of Manchester United, the The former Arse- third-wealthiest club in the nal and Roma footbal- world by revenue, told in- ler in January moved for vestors recently that China’s a USD20m transfer fee to investment had created “an- Qinhuangdao, a city best other useful market if we’re known as the country’s looking to sell any players”, biggest coal port. His new without noting that Euro- employer, recently promot- pean clubs may face stiffer ed China Super League team competition to sign that tal- Hebei China Fortune, has ent in the first place. been transformed by the “In a matter of weeks, sudden rush of investment we’ve seen the global pow- from its billionaire owner. er balance in football shift The impact of such in- east by quite a big margin,” vestments has not gone says Simon Chadwick, a unnoticed. Through buy- professor of sports business ing foreign players, taking at the UK’s Salford Uni- stakes in overseas clubs versity. “China and football like Manchester City and have been flirting with each even acquiring sponsorship other for the best part of two rights for FIFA, the game’s decades but it’s never really governing body, China’s taken off. The big difference spending splurge on football now is the backing of Pres- is reverberating around the ident Xi and his desire to world. host the World Cup and then Supported by some of eventually win it.” the country’s best-known Just like its plans for coal tycoons including Jack production and railway con- Ma of Alibaba and Wang struction, the ruling Com- Jianlin of Wanda, it mirrors munist party has a fixed its unprecedented acquisi- growth target for sports. It tion spree of other premium Guangzhou Evergrande players celebrate after scoring a goal released a plan last year to global assets from hotels achieve Mr Xi’s goal to turn to agribusiness. And it has international power, reflect- industries from robotics to to power, and with his sup- ter transfer window, more China into a “great sports prompted similar questions. ing Beijing’s ambitions to aviation. port, sports are being giv- than in any other league, in- nation”, creating an industry Are Chinese companies compete in other global “After Xi Jinping came en a boost,” says Zhang cluding England’s big-mon- worth Rmb5tn ($760bn) by overpaying? Is such ram- Dazhong, chief executive ey Premier League, accord- 2025, up from Rmb400bn- pant deal making sustain- of the recently established ing to Deloitte. last year, and expanding the able or is yet another bubble Unlike an earlier trend sports division at Alibaba, Unlike an earlier trend number of schools offering soon to burst? the Chinese ecommerce of importing fading stars, specialised football training Much seems to hinge on of importing fading group that invested in the several clubs have secured from 5,000 to 50,000. the backing of one man: country’s top club in 2014. leading players from Euro- The ultimate aim is to win President Xi Jinping, a fan stars, several clubs have “It’s high time for us to do pean teams. Record sign- a bid to host the World Cup of the game who wants to secured leading players this.” ing Alex Teixeira, a 26-year- and help the poorly perform- turn China from a foot- CSL clubs spent more old Brazilian midfielder, ing national team - ranked balling backwater into an from European teams than $280m during the win- joined Jiangsu Suning from 96 in the world, behind Syndicated articles from 04.04.2016 F2 © The Financial Times Limited 2016. All Rights Reserved. Not to be redistributed, copied or modified in any way. Chinese football, more than a game (continued) the Faroe Islands and North ambition and allow Chinese wards pay-per-view sports. Korea - compete at the companies to learn from the XINHUA The media executive esti- highest level. The nation’s experts. But they admit it mates that with revenues as tycoons - many of them has put them under financial they stand and half of the beneficiaries of the long pressure. league’s 16 teams spend- property boom - are lend- “We don’t know yet if the ing Rmb1bn or more a year, ing their support, investing premiums clubs are pay- clubs will be racking up sub- heavily in the CSL, creating ing for players are justified stantial losses. football schools, competing and it’s very hard to value Richard Battle, a football for TV rights after their re- them,” says Adrian Chen, business analyst at Deloitte, lease from state control and an executive at R&F Prop- argues that deep-pocketed acquiring stakes in some of erties, which owns Guang- owners and rising reve- Europe’s top clubs. zhou R&F, one of two CSL nues will support the medi- Less than two months af- clubs in the southern city. um-term growth of the game ter Mr Xi posed for a self- “We hope there will be an in China. “As long as high- ie with Manchester City improvement in gameplay net worth individuals and striker Sergio Aguero while that will boost ticket and businesses want to compete on a state visit to the UK in merchandise sales and im- in football, clubs don’t have October, Li Ruigang, a me- prove the overall quality of to generate all the revenue dia mogul who was on the football in China.” needed to cover their costs,” trip, led a consortium that Guangzhou’s other team, he says. paid $400m for a 13 per cent now known as Evergrande Football supporters in Chi- share of the club. Mr Li also Taobao FC after Alibaba’s na fear that these tycoons paid a record Rmb8bn for investment, paved the way will lose interest, run out of the five-year rights to broad- for China’s football revo- cash or even fall foul of Pres- cast the CSL and sold them lution, recruiting interna- ident Xi’s other pet project - on for a profit in February. tional players and coaches, the anti-corruption crack- Last year Mr Wang, chair- building one of the world’s down. “If China doesn’t get man of the Wanda property biggest football schools, results quickly, how long and entertainment group, dominating the CSL and before these investors go paid $52m for a stake becoming the first Chinese cold?” asks Mr Chadwick. in Spain’s Atlético Ma- winners of the Asian Cham- “A lot of this is dependent drid and Chen Yansheng, a pions League in 2013. on President Xi. If something toy-car tycoon, took control “We have the biggest fan happens to him, how quickly of Espanyol, another top-ti- base in the country and are will all this unravel?” er Spanish team. totally market oriented,” While owners worry about Wanda and Alibaba have says Mr Zhang of Alibaba, Gao Lin (righ) of China vies with Ali Samooh of Maldives during 2018 FIFA World Cup qualification finances, fans are debating both signed sponsorship which owns 38 per cent of football match played last month in Wuhan, China whether the influx of for- deals with scandal-hit the club. The club became eign stars will help or hin- Fifa in recent months, with the first Asian football busi- ball writer in China who has baba also see an opportunity in media rights, ticket sales der the development of the Wanda claiming that its ness to list on a stock market transformed himself into a to build content businesses and other revenue streams. national team, which failed agreement would leave it last year. Mr Zhang boasts player’s agent, says Ever- in a country where mobile Lei Zhenjian, chief ex- in its most recent effort to “better placed to play a role of a market capitalisation grande set the standard for commerce is growing fast. ecutive of LeEco Sports, qualify for the World Cup. in the bidding process to close to Manchester Unit- others to follow, while Mr Most clubs have seen a sig- an online broadcaster CSL teams are limited to host major football events ed’s $2.3bn, although its Xi’s enthusiasm “had a big nificant jump in attendances that bought the first two signing five foreign players such as the World Cup”.