Sul sito de L’Ultimo Uomo abbiamo fatto il punto della situazione sul collasso della Chinese Super League dopo la dissoluzione dello Jiangsu FC campione in carica
Lo scorso 12 novembre lo Jiangsu Suning ha vinto il suo primo campionato dopo aver battuto il Guangzhou Evergrande di Fabio Cannavaro per 2-1 nella finale di ritorno (0-0 all’andata) grazie a una grande prestazione di Alex Teixeira. Il brasiliano, che nel 2016 Suning aveva prelevato dallo Shakhtar Donetsk per 50 milioni di euro, sul finale di primo tempo si è procurato un fallo dal limite, sulla cui punizione ha poi aperto le marcature Eder. A inizio ripresa, Teixeira ha trovato anche il raddoppio, rendendo inutile il gol di Wei Shihao, con cui la squadra allenata da Cannavaro ha accorciato le distanze. L’euforia per questo trionfo però è durata pochissimo e nessuno si sarebbe mai immaginato che sarebbe stata l’ultima partita di campionato nella storia dello Jiangsu.
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The collapse of Jiangsu Suning and Chinese Super League
On 12 November, Jiangsu Suning won their first championship after beating Fabio Cannavaro’s Guangzhou Evergrande 2-1 in the return leg (0-0 in the first leg) thanks to a great performance by Alex Teixeira. The Brazilian, who Suning bought from Shakhtar Donetsk for €50 million in 2016, was fouled at the end of the first half from the edge of the box, with Eder scoring from the free kick. At the start of the second half, Teixeira also scored twice, making Wei Shihao’s goal pointless as Cannavaro’s side closed the gap. The euphoria of this triumph was short-lived, however, and no one could have imagined that it would be the last league game in Jiangsu’s history.
What happened with Suning
The creaks had already been felt during the regular season of the 2020 Chinese Super League season, when the players left the training session to protest against the non-payment of salaries. It was a case that the club had cleared up in less than 24 hours, but which left a heavy trail. Afterwards, in fact, the very harsh statements of the Romanian coach Cosmin Olaroiu (one of the most successful coaches in the recent history of Asian football), who, after winning the championship, as a guest on the podcast of The Asian Game, said he was unhappy with the management of the club, especially for not having received the support he expected in the improvement of the team.
In reality Jiangsu’s difficulties have to do with a wider sphere than just a football club. In fact, the Suning group who own the team have shown some serious financial difficulties with losses of half a billion euros as early as the end of 2020, finding themselves forced to downsize their football division. We’re not just talking about Jiangsu or Inter, for which rumours of a possible sale in the near future continue to rumour, but all the investments Suning has made in football in recent years.
The online broadcaster PPTV, owned by Suning, for example, lost the right to broadcast Serie A matches in China due to payment delays (the right was then regained in mid-February, after Suning succeeded in signing a “bridge agreement” with IMG, the company responsible for marketing the TV rights of our league abroad), after having lost the Premier League TV rights last year for the same reason (but this time definitively), with which it had an agreement for a total of €650 million. The same happened with La Liga and finally even with the Chinese Super League, since on 3 March China Sports Media, which holds the rights to the Chinese Super League, announced the suspension of its relationship with PPTV and the Chinese federation. At this point, it is to be expected that Suning will also terminate its relationship with the Bundesliga (the last remaining football league to which it has the rights), thus decreeing the end of PPTV’s sports section.
Returning to Jiangsu, Suning waited until the last available day (29 January) to pay the salaries of players and staff. A decision that did not please neither the coach Cosmin Olaroiu, who decided to terminate his contract, nor the team, with Alex Teixeira who decided to expire without renewing his contract. A clear downsizing of the expectations of the Chinese champions was on the horizon, but no one would have ever expected that Suning could even decide to dissolve Jiangsu by putting an end to their football activities in China.
It is possible that before taking such a drastic decision the Suning group tried to sell (or perhaps even give) the club to the Wuxi government, with an attempt to move the team from Jiangsu’s capital, but in the end nothing came of it. In a video circulated on the internet in recent days, Suning’s owner Zhang Jindong reiterated the Chinese giant’s desire to focus solely on the retail sector and to get rid of all those activities that were considered non-essential, especially because of the financial damage resulting from the Covid-19 pandemic.
As mentioned, Suning has had a difficult 2020. Last year, Suning had invested heavily in real estate together with the Evergrande fund (owner of the Guangzhou club) with the opening of over 3200 new outlets. Despite this, and the increase in online users by 68% and in product sales volume by over 100% compared to 2019, Suning.com still closed with losses of half a billion (on a turnover of around 33.6 billion euros). Hence the need to get rid of branches considered unproductive, such as Jiangsu, and to bring in new investors as minority partners, such as the Shenzhen Holding Group, which bought about 23% of Suning for an amount equal to $ 2.29 billion.
The same, as reported by several Italian newspapers, could also happen in a smaller way at Inter, which has conducted negotiations to sell shares in the club (for example with the fund BC Partners, which had shown a very strong interest in the Nerazzurri club).
What triggered the implosion of Chinese football
Although Suning’s situation is not actually flourishing, Jiangsu’s is only one of the many stories of club dissolution in China, where this kind of event is more frequent than one might think. As many as 16 teams have disappeared since the beginning of 2020, including three first division clubs. And the process does not seem to be able to stop.
At the origin of these sudden problems, for a movement that until a few years ago seemed to be on an unstoppable rise, there are not only contingent financial difficulties but also government decisions that have little to do with the solidity of the companies. One of these is the reform by the Chinese Football Association, which has forced clubs to remove their corporate names, which are widespread in China.
This of course does not mean that Chinese clubs do not have problems. Despite the fact that in recent years the Chinese football market has become one of the richest in the world, with the arrival of players such as Oscar, Hulk, Paulinho, Anderson Talisca and Alex Teixeira among others, even the ‘big’ teams have remained modest in size, financially speaking. For example, Guangzhou Evergrande, China’s most successful club, with an annual turnover of around 90 million euros, has costs that are four times higher.
Most of the profits of a Chinese Super League club come from TV rights, federation sponsors and matchday box office (the Chinese one is one of the leagues with one of the largest turnouts in the world, with over 22 thousand average spectators per game in 2019), while few clubs have personal sponsors that are relevant and merchandising activity for most teams is absent.
While the turnover of the most prestigious clubs in the Chinese Super League ranges between €30 and €50 million, they are faced with much higher costs from salaries and player fees that have spiralled out of control in recent years. Instead of trying to lay the foundations for a long-term sustainable strategy, the Chinese federation and government have simply tried to curb this haemorrhaging of capital (not least because many of the companies that own clubs are state-owned), with reforms and restrictions that have never solved the problem at its root.
Starting from the 2020 season, the Chinese Super League introduced the salary cap, which prevents clubs from paying new foreign signings a salary higher than $3 million (excluding image rights) – a limitation that comes on top of the so-called “luxury tax”, which obliges teams to pay a fine to the Federation for signings exceeding €6 million, equal to the cost of the player’s card.
Even though even in China there are always ways to circumvent the laws (to ensure Oscar’s €25 million salary, for example, Shanghai SIPG elected the player vice-president of the company), in the end these reforms have had the desired effect. After a clear reduction of investments already in the 2020 football market, in the just ended winter session the Chinese Super League clubs invested just 26.7 million euros in the purchase of new players. To find a market session poorer than this one, one has to go back to the winter of 2010.
But the problem is much deeper than market investments. Jiangsu, in fact, is not the only club to have dissolved in recent weeks. Before Suning’s team, Tianjin Teda and Tianjin Tianhai also disappeared from the top flight last year. This is without counting the trickle of small clubs in the lower leagues – a constant in the last decade, but which has reached worrying proportions in recent months. Clubs that recently participated in the Chinese Super League, such as Beijing Renhe and Yanbian Funde, have been dismantled, while Tibetan club Lhasa Chengtou will no longer be in the third division. And now that this phenomenon has started to affect the Chinese Super League, the impression is that Jiangsu will not be the last club to disappear.
As we reported some time ago, Chinese football has only been dealing with professionalism since the mid-1990s and clubs have always been linked to the owner company, almost always state-owned, rather than the city they belong to. This has led many clubs to change their name, logo, club colours and sometimes even city, depending on the company that owns them at the time. Until 2015, when one of the most important reforms in Chinese football in recent years was enacted, a club could move anywhere. After that, the government decided that a club could only move within its original region.
The same reform included the removal of company names from club names – a rather controversial aspect for the reasons we have just mentioned and which in fact the Chinese government only decided to implement in November 2020. The aim of the reform was to create a recognisable and above all stable framework for Chinese football, but it ended up backfiring on the very federation that had promoted it, finding opposition both from clubs, who saw it as an opportunity to free themselves from the investments they had to make, and from fans, who perceived it as an attack on the culture of football in China.
The name reform has not spared clubs that have been linked to the same company since the 1990s and have never changed their names, such as Beijing Guoan, Changchun Yatai, Henan Jianye and Tianjin Teda. It is no coincidence that the fans of these teams have protested vehemently: fans of the Royal Army (ultras group of the Beijing team) have rented advertising space on some buses passing in front of the federation headquarters, decorating them with the club colours and a very clear message: “Our name is Guoan”. Guanpeng Wang, a documentary filmmaker for Copa 90 and a great supporter of Tianjin Teda, was one of the initiators of the online protest campaign against the federation, and made a very special video, contacting former foreign players of the club, who joined his appeal asking the federation not to remove the Teda name. While the aim of the reform may be understandable, perhaps the federation should have asked itself why companies would continue to invest in clubs in the absence of a sustainable framework in which to expect profits in the future and without even being able to use the club’s name as a shop window.
In addition to the aforementioned clubs, Henan Jianye, owned by the real estate fund of the same name, announced on 31 December that it was selling part of its shares to a group of investors and renaming the club as Luoyang Longmen, implying a move from the capital of Henan province, Zhengzhou, to the city of Luoyang (also in the same province), 100 kilometres away. The fans’ reaction was immediate, with the announcement of the dissolution of the ‘Red Devils’ ultras group and a protest in front of the stadium against the ownership.
The Jianye real estate fund was not the only one to take the opportunity to free itself from this business: Shijiazhuang Everbright (owned by the Everbright real estate fund), relegated at the end of this season, also changed city and name, selling shares in the club to the Cangzhou city government (now called Cangzhou Mighty Lions). The same story for Hebei Fortune (the club in which Lavezzi, Mascherano and Gervinho played), which moved from Langfan to Tangshan (changing its name to Hebei FC), with the ownership trying to get rid of the club – in deep financial crisis.
The horizon for Chinese football does not look exactly rosy. This has also been confirmed by several Chinese journalists such as analyst Yan Qiang and journalist Ma Daxing, who say that ‘the foundations of Chinese football are too weak’.
It is not so much a lack of political will. China continues to build infrastructure and invest in education. The “Dragon” is preparing to host important events such as the Asian Cup in 2023 and the new 24-team Club World Cup (the date has yet to be determined), and it still has ambitions to organise the World Cup for national teams. Huge new stadiums are being built for these major events, but their fate once these events have passed is unknown, apart from the short-term one of adjusting the local GDP and keeping the employment rate high.
There is also no strategy when it comes to youth football as outlined in this lengthy article on wildeastfootball: schools and clubs receive government funding based on their results and therefore a short-term strategy is created to win youth tournaments (often cheating on the age of the players) in order to hopefully get more funding the following year. It is no coincidence that in the last ten years China has not produced any significant talent (with the exception of Wu Lei) and that in the Asian Cups the youth selections have never passed the group stage.
And today, after 10 years of uncontrolled investments, China, with the reform of club names, seems to have closed the door to the development of a real movement. That perhaps will remain nothing more than a nostalgic memory of the decade that has just passed.
