Just over a decade ago, China’s president, Xi Jinping, had a dream: to transform China into a global soccer powerhouse. This ambition was promptly backed by decisive action and significant financial backing. Chinese conglomerates pumped money into the domestic league, attracting soccer stars based in Europe. Some companies even splurged on purchasing stakes in European clubs with the aim of elevating Chinese soccer’s standards.
However, China’s ambitions never really took off — in fact, they could be on the brink of total collapse. On Wednesday, U.S.-based asset management firm Oaktree Capital took over the Italian soccer club Inter Milan after its Chinese owner, Suning Holding Group, failed to repay a 395 million euro ($429 million) debt on time. Suning had put its stake in Inter Milan up as collateral.
The loss of Inter Milan is part of a larger trend of Chinese companies withdrawing from European soccer. In 2017, as many as 20 European clubs were owned by major Chinese investors. By 2021, that number had dwindled to just 10.
The Failed Experiment
The forced exit of Suning from European soccer concludes a decade-long experiment to see if flashy multi-billion dollar deals targeting elite sports could trickle down to nurture a true soccer-playing titan.
“Looking back, there haven’t been many great examples of success,” 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 acquiring them.
Furthermore, these substantial foreign investments into elite professional soccer did not lead to gains at home. China’s national team has not participated in the FIFA World Cup for over two decades.
According to Tom Byer, a Tokyo-based soccer youth development consultant with experience in China’s soccer system, China’s entry level is “broken.” “The biggest driver in football is culture, and there’s no culture in China. Most Chinese families see football as a distraction to education, and they don’t want their kids to play.”
The Rise and Fall of China’s Soccer Ambitions
China’s underperformance in soccer is stark compared to the ambitious plans unveiled in the mid-2010s. In 2016, Suning purchased a 70% stake in Inter Milan, marking one of the highest-profile ventures by a Chinese business into European soccer. That same year, organizations like the Chinese Football Association unveiled plans to transform China into a “world football superpower.”
Other Chinese companies, flush with cash from the country’s booming economy, bought stakes in European clubs. For instance, the Dalian Wanda Group purchased a 20% stake in Spanish club Atletico Madrid in 2015, and Fosun International bought the English club Wolverhampton Wanderers in 2016.
However, just as things started to soar, the authorities called a timeout on these ambitions. The Chinese Football Association ordered clubs to curb “irrational spending” on foreign players in 2017, as well as limit their presence in top-tier teams to support local talent. Three years later, in 2020, the CSL ordered sponsors to remove their brand names from local clubs.
Then, the money ran out. Beijing’s campaign to curb excessive borrowing in the property sector put Evergrande, a large real estate developer and owner of Guangzhou FC, in a liquidity crunch. Government authorities took over the company’s soccer stadium in late 2021.
Former Inter Milan owner Suning also faced a cash crunch. The conglomerate’s stakes in an Evergrande subsidiary sank in value as the parent company crashed, and e-commerce competitors like JD.com also pressured Suning’s core retail business, constraining its ability to fund operations at its domestic club, Jiangsu Suning FC. The club disbanded ahead of the 2021 season, just after winning its first-ever CSL title.
Who Owns Europe’s Clubs Now?
With the exit of Chinese companies, the U.S. now has a larger presence in global soccer. Half of the teams in England’s top league now have some level of U.S. ownership. Furthermore, Inter Milan is now the seventh club in Italy’s top league to be owned by a U.S. firm.
Gulf states are also beginning to buy clubs in Europe’s 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.
Will China Ever Be Good at Soccer?
China’s male soccer players perform poorly on the global stage. The country’s national men’s 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.
Even China’s president Xi jokes about his team’s performance. In November, after China’s team beat Thailand’s in a FIFA World Cup qualifying match, the Chinese president told Thai prime minister Sretta Thavisin that “there was a lot of luck involved,” according to a post from the Thai government’s official social media accounts.
“I’m not so sure about their level,” Xi added. “There are ups and downs.”
