\n<\/p>\n
About a decade ago, Xi Jinping, China\u2019s president, had a dream<\/a>: to turn the country into a global soccer powerhouse. That ambition was quickly backed by action and money. Chinese conglomerates poured money into the country\u2019s domestic league, even attracting<\/a> soccer stars based in Europe. Some firms splurged on buying up stakes<\/a> in European clubs in order to raise the standards of Chinese soccer.<\/p>\n But China\u2019s ambitions never took off\u2014and could be on the verge of unravelling entirely.<\/p>\n On Wednesday, the U.S.-based asset management firm Oaktree Capital took ove<\/a>r the Italian soccer club Inter Milan after its Chinese owner, Suning Holding Group, failed to repay a 395 million euro ($429 million) debt in time. Suning had offered its stake in Inter Milan as collateral.<\/p>\n Suning losing its ownership of Inter Milan is part of a broader exodus of Chinese companies exiting European soccer. As many as 20 European clubs were owned by<\/a> major Chinese investors in 2017; that had fallen to just 10 by 2021.\u00a0<\/p>\n Claudio Villa\u2014FC Internazionale\/Getty Images<\/p>\n<\/div>\n Suning\u2019s forced exit from European soccer caps a decade-long experiment as to whether flashy multi-billion dollar deals targeting elite sports could trickle down to build a true soccer-playing giant.\u00a0<\/p>\n \u201cLooking back, there haven\u2019t been many great examples of success,\u201d says John Duerden, a long-time Asia soccer reporter. Chinese ownership of these European clubs did not result in massive investments or significant victories on the field. Several Chinese owners sold their stakes in professional European clubs within years of buying them.<\/p>\n Nor did these big foreign investments into elite professional soccer translate to gains at home.\u00a0China\u2019s national team has not taken part in the FIFA World Cup for over two decades. <\/p>\n China\u2019s entry level is \u201cbroken,\u201d says Tom Byer, a Tokyo, Japan-based soccer youth development consultant with experience in China\u2019s soccer system. \u201cThe biggest driver in football is culture, and there\u2019s no culture in China. Most Chinese families look at football as a distraction to education, and they don\u2019t want their kids to play.\u201d<\/p>\n China\u2019s soccer performance are a big miss compared to the ambitious plans unveiled in the mid-2010s.\u00a0<\/p>\n In 2016, Suning bought<\/a> a 70% stake in Inter Milan in what was one of the highest-profile forays by a Chinese business into European soccer. That same year, organizations like the Chinese Football Association put forward plans<\/a> to turn China into a \u201cworld football superpower.\u201d<\/p>\n Other Chinese companies, flush with cash from the country\u2019s booming economy, bought stakes in European clubs. The Dalian Wanda Group bought a<\/a> 20% stake in Spanish club Atletico Madrid in 2015, and then signed a five-year<\/a> naming rights deal when Atletico moved to its new stadium in 2017. Fosun International bought<\/a> the English club Wolverhampton Wanderers in 2016.\u00a0<\/p>\n Soccer fans at the time weren\u2019t concerned about a club\u2019s new Chinese ownership. \u201cNationality is secondary. As long as the results are OK, fans tend to put those concerns aside,\u201d Duerden said.<\/p>\n Conglomerates also poured money into the Chinese Super League, the country\u2019s top domestic soccer league. In 2010, China Evergrande Group\u2014then one of the country\u2019s largest real estate developers, years before its collapse triggered today\u2019s real estate crisis\u2014bought Guangzhou FC. From 2016, Evergrande funded costly transfers of players based in Europe to China. Other owners of Chinese soccer clubs, including Suning, also funded their own transfers from Europe.\u00a0<\/p>\n VCG via Getty Images<\/p>\n<\/div>\n At one point, the CSL rivaled<\/a> Europe\u2019s biggest leagues for money spent on transfers. It spent 418 million euros ($453 million) in 2016 and 543 million euros ($589 million) in 2017, according to data from Transfermarkt, a soccer website that aggregates player transfer data.\u00a0<\/p>\n But just as things started to take off, authorities called time on these ambitions.<\/p>\n The Chinese Football Association ordered clubs<\/a> to curb \u201cirrational spending\u201d on foreign players in 2017, as well as limit their presence in top-tier teams in order to support local talent. Three years later, in 2020, the CSL ordered sponsors<\/a> to remove their brand names from local clubs.\u00a0\u00a0<\/p>\n Then money got tight. Beijing\u2019s drive to rein in excessive borrowing in the property sector put Evergrande in a liquidity crunch<\/a>. Government authorities took over <\/a>the company\u2019s soccer stadium in late-2021. (Evergrande had defaulted on its overseas debt by the end of the year).<\/p>\n Former Inter Milan owner Suning also had a cash crunch. The conglomerate\u2019s stakes in an Evergrande subsidiary sank in value<\/a> as the parent company crashed. E-commerce competitors like JD.com also pressured Suning\u2019s core retail business, constraining its ability to fund operations at its domestic club, Jiangsu Suning FC. The club disbanded ahead<\/a> of the 2021 season, just after it won its first-ever CSL title.\u00a0<\/p>\n Suning\u2019s loss of Inter Milan last week has erased the net worth of company founder Zhang Jindong. The one-time billionaire was worth about $6 billion when his company bought Inter Milan in 2016, according to Bloomberg calculations<\/a>. It\u2019s now close to zero.\u00a0<\/p>\n Suning made its name in retail, selling electronic appliances in thousands of brick-and-mortar outlets. With $35.5 billion in revenue for the 2020 financial year, the Chinese company ranked 328 on Fortune\u2019<\/em>s 2021 Global 500 list.\u00a0<\/p>\n That was the last time Suning made the list, as revenue dropped to $10 billion in 2022.\u00a0<\/p>\n Oaktree, in a statement soon after it seized control of Inter Milan, said its<\/a> initial focus will be to ensure \u201coperational and financial stability.\u201d The firm is planning to bring in more Italian and European members to the club\u2019s board. (At the time of Oaktree\u2019s takeover, people of Chinese origin made up more than half of Inter Milan\u2019s board, including its president.)<\/p>\n The U.S. now has a bigger presence in world soccer. Half of the teams in England\u2019s top league now have some level of<\/a> U.S. ownership. And Inter Milan is now the seventh club<\/a> in Italy\u2019s top league to be owned by a U.S. firm.<\/p>\n Gulf states are also starting to buy clubs in Europe\u2019s top leagues. Paris Saint-Germain, owned by Qatar Sports Investments, dominates the French league, while British club Manchester City, owned by a company controlled by United Arab Emirates royal Sheikh Mansour, is winning both domestically and in Europe.\u00a0<\/p>\n Oli Scarff\u2014AFP\/Getty Images<\/p>\n<\/div>\n But some ownership stakes are controversial. Human rights activists and some politicians<\/a> have criticized<\/a> the takeover of Newcastle by the Public Investment Fund, Saudi Arabia\u2019s sovereign wealth fund, as \u201csportswashing,\u201d or using soccer to help cover up the country\u2019s human rights record.<\/p>\n China\u2019s male soccer players perform poorly on the global stage. The country\u2019s national men\u2019s team is ranked 88th out of 210 teams, low for a country of its population size. The team has only qualified for the FIFA World Cup once, back in 2002.<\/p>\n Byer, who previously held positions in Chinese soccer at the youth level nationally and at the Beijing Guoan soccer club, says that \u201cmost people have no clue about youth development.\u201d<\/p>\n While China focused at the elite level, its neighbor Japan instead targeted younger players. That \u201cautomatically increases the elite player pool, because the gap between the best and least developed becomes smaller,\u201d Byer explains.\u00a0<\/p>\n Japan qualified for the FIFA World Cup for the first time in 1998, but has since qualified for every competition since. More Japanese players are playing<\/a> in Europe\u2019s top leagues, the pinnacle of professional soccer. <\/strong>(There are currently no Chinese soccer players in Europe\u2019s top leagues after Wu Lei left the Spanish club<\/a> Espanyol in August 2022.)<\/p>\n China is currently competing in the qualifiers for the upcoming 2026 FIFA World Cup, to be held in Canada, Mexico and the U.S.<\/p>\n Even China president Xi jokes about<\/a> his team\u2019s performance. In November, after China\u2019s team beat Thailand\u2019s in a FIFA World Cup qualifying match, the Chinese president told Thai prime minister<\/a> Sretta Thavisin that \u201cthere was a lot of luck involved,\u201d according to a post from the Thai government\u2019s official social media accounts.\u00a0<\/p>\n \u201cI\u2019m not so sure about their level,\u201d Xi said. \u201cThere are ups and downs.\u201d<\/p>\n<\/div>\n\n","protected":false},"excerpt":{"rendered":" About a decade ago, Xi Jinping, China\u2019s president, had a dream: to turn the country into a global soccer powerhouse. That ambition was quickly backed by action and money. Chinese conglomerates poured money into the country\u2019s domestic league, even attracting soccer stars based in Europe. Some firms splurged on buying up stakes in European clubs […]<\/p>\n","protected":false},"author":235,"featured_media":11194,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_uag_custom_page_level_css":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[123],"tags":[],"class_list":["post-11193","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"yoast_head":"\nA \u201cworld football superpower\u201d<\/strong><\/h2>\n
Who owns Europe\u2019s clubs now?<\/strong><\/h2>\n
Will China ever be good at soccer?<\/strong><\/h2>\n