Recently, President Xi set out his golden vision for football in his country.
“My greatest hope for Chinese football is that Chinese teams can become one of best in the world […] That football can play an important role in strengthening people’s physique and inspiring a relentless fighting spirit.”
Xi set out a 10-year plan, running from 2015 to 2025, designed to double the size of the Chinese sports economy to more than £600billion, based on state and private investment into the beautiful game, seeking to produce 100,000 players by ploughing money into grassroots football, developing 20,000 new ‘football schools’ and creating 70,000 new pitches. He also set out ambitious plans for China to qualify again for the men’s FIFA World Cup (China is already a regular at the FIFA Women’s World Cup), for China to become a host nation for a FIFA World Cup, and for China to win a FIFA World Cup.
The business community took Xi’s statements as a request and began pouring in massive amounts of private money into the Chinese Super League, which culminated with the signing of a new $1.2 billion TV rights deal between China Media Capital and the Super League. This was an enormous 500% jump over the previous deal with state broadcaster CCTV.
Results on the pitch have nudged things along too. After Guangzhou’s Asian Champions League victory, the Super League raised about 50 million euros through new sponsorship agreements. This growth is enormous, with agreements in previous seasons exceeding no more than 5 million euros. The profits of the two main leagues are now regularly redistributed to the clubs. In 2014, the first division teams received three times the revenue collected in the previous two years. Ticket sales have also surged in recent years.
All this new money means new expectations, driving ambitious transfer plans which have attracted a long list of recognisable names from the elite European leagues migrating to ply their trade in the East, including Marouane Fellaini, Oscar, Graziano Pelle, Javier Mascherano, Odion Ighalo, Paulinho, Yannick Carrasco, Renato Augusto Jonathan Viera, Ramires, Alexandre Pato and Brown Ideye.
The Brazilian playmaker and ex-Chelsea wonderkid earning a reported £21m-a-year has become a hero in Shanghai since moving to China in 2017 but the 27-year-old remains in international wilderness.
China at the FIFA Women’s World Cup in 2019. China has a strong history at the Women’s World Cup.
“Chinese Super League (CSL) club expenditure is about 10 times higher than South Korea’s K-League and three times higher than Japan’s J-league. But our national team is lagging far behind,” Chinese FA president Chen Xuyuan said.
Despite a massive influx of recognisable names from Europe’s top leagues being tempted into lucrative contracts in the Super League, China is going to need far greater output from its native talent pool if it is to reach the heights of the golden vision set out by its President. Currently, China sits meagrely in 75th in the FIFA World Rankings, nestled between minnows of the game such as Uganda, Curacao and El Salvador. Whilst its Women’s team fare far better in 15th, the overall picture for one of the great superpowers of the world is far below its expectations. Its Asian counterparts South Korea are 38th and Japan are 27th.
China’s hopes for developing its home pool of talent is thwarted by its poor FIFA Ranking. Work permits to European clubs are awarded under a points-based system which factors in FIFA Ranking and applies a weighting to domestic leagues, both of which China fall short on. Under current circumstances, it is virtually impossible to satisfy work permit requirements to get Chinese players into the Premier League. With chances limited in the top global leagues for Chinese nationals, grassroots investment will be necessary to match the sort of athletic supremacy we have seen China rise to in Olympic sports such as swimming and gymnastics.
In a bid to better its position domestically – and in a pivot away from its previous strategy to pull in big foreign talent at all costs, the Chinese Super League will introduce salary caps from next season in an attempt to “curb money in football” and support the national team. China’s top-flight will cap foreign players’ annual salaries at 3m euros (£2.7m), with domestic players earning a maximum of 5m yuan (£571,000) a year. Teams who exceed limits can be docked up to 24 points. Players could also be banned from matches organised by China’s football association (CFA).
The CFA said it hoped the move would “curb money” following many high-value international transfers in recent years and provide an “investment bubble” into the Chinese national team. Super League clubs will be soon only be allowed to spend up to 600m yuan (£68m) per year on salaries total, with up to £9m of that on foreign talent. The caps will come into effect from 1 January, with limits also to be introduced for the second and third tiers of Chinese football.
The rule changes are reportedly to make the league more sustainable and attractive to investors, as well as help push top Chinese players to try and get moves to play abroad like Wu Lei, who has played almost every game for Espanyol this season. As the salary cap applies to new signings, there is unclear as to whether there will be any mass exodus of foreign stars from China just yet, rather the players who do return to Europe would be replaced by players on lower salaries. It was reported that Oscar’s wages in China are £400,000 a week, the equivalent of £20.8m a year – almost eight times the new cap.
Several Chinese soccer pundits believe the salary cap won’t have the impact that Western media is predicting, largely because Chinese clubs will likely try to circumvent the rules like they have done in the past. In 2018 when the Chinese Super League introduced a 100% tax on large transfer fees, Beijing Guoan reportedly tried to use a loophole to sign Cedric Bakambu from Villareal without paying this tax.
There appear to be several potential loopholes. One is through the use of huge performance bonuses which don’t appear to be included in the salary cap. The use of third parties, like those reportedly used in the Bakambu case, could be another option, especially as the reported rules on total spending by clubs might make the use of bonuses impractical (this total spending and salary cap is potentially more important than the cap on individual salaries). A third way could be through the use of a foreign proxy club not too bothered about Financial Fair Play who could sign the player, pay the majority of their salary, then loan them to a club in China.
Because clubs can often find a way around these financial rule changes, the effect of the salary cap will largely be determined by the appetite that Chinese clubs have toward bending the rules, and whether they will gain from doing so. The salary cap won’t mean less foreign players in China though. If anything, there will be more foreigners in 2020 as the Chinese Super League has increased the number of foreign players allowed in the match day squad from four per team to five per team (although only four can be on the pitch at the same time).
The big spending in the past by the Chinese Super League didn’t lead to success for the national team, so it is little wonder that there is a drive to stop unsustainable spending. But the new rules could impact the recent attempts to strengthen the national team by using naturalised players. If such players are treated as Chinese, then they will be subject to a lower salary cap than if they were classed as foreign players, which would hardly act as an incentive for players to change their nationality. Becoming Chinese is a huge step for any player to take already, and as the Super League’s rules on naturalised players change as regularly as the rest of the league’s rules, there is a lot of risk involved for what may be a smaller reward.
Previous rule changes in the Super League stopped spending from becoming completely out of control, but the league has remained attractive to foreign players, and if clubs can find a way around the salary cap then the latest rule changes are unlikely to end that straight away, but the general trend towards a more sustainable league means that there will probably be fewer big-name transfers to China this January than there have been in the past.
As China grows as a global superpower, so will its expectations and aspirations. As we perhaps first saw in the Beijing 2008 Olympics, the Chinese government takes its global statements of athletic supremacy seriously, and there is no better forum for that than football.
Expect China to invest big into its football infrastructure and grow itself into an increasingly competitive position over time. Its move to restructure its domestic league for the benefit of homegrown players and its increase in commercial investments into its clubs should mean results.
We believe that China will become one of the major superpowers of football within the next 20 years. With its impressive infrastructure into stadia and logistics and FIFA’s eagerness to appoint developing football nations as World Cup hosts, expect to see a FIFA World Cup coming to China soon.
Zhang (pictured) has high hopes with both club and country in Year of the Ox. The forward excelled with Beijing FC on both domestic and Asian fronts in 2020 and he eyes improved displays with the national team in FIFA World Cup qualifying.