Arabs on the Counter-Why Investment in Football from the Middle East is best for business

The Arabs are coming. One club and one sponsorship deal at a time, they are slowly but surely climbing up the ladder to the upper echelons of World Football. The first major indication was given when the Abu Dhabi United Group bought Manchester City in 2008. Within days they had made an impact, splashing enough cash to bring Robinho to Eastlands. A couple of managers and many players later, City now stand with two League titles and three domestic cups to show for all the money that Sheikh Mansour put in.

The French capital was up next. In the summer of 2011, the Qatari government’s investment arm announced its purchase of Paris Saint Germain. Their stated aim was to put Paris on the map of World Football. Noble as it may seem, one may wonder if it is indeed the primary intention; certain events off the pitch show that for these ambitious Arab owners, City and PSG are just little pieces on a huge chessboard.

If buying clubs was one way of announcing yourself to the world, sponsorship deals were another. It was Emirates, the official carrier of Dubai, who set the pace with their ‘Fly Emirates’ logo gaining global fame, adorning the jerseys of PSG, Arsenal, AC Milan and t most visibly, Real Madrid. Emirates have had an important relationship with Arsenal, with a long term deal for the stadium naming rights. By now, the word ‘Emirates’ has become quite synonymous with the North London club while ‘Ashburton Grove’ may soon become alien!

Abu Dhabi’s airline Etihad Airways has a similar relationship with Manchester City. The neighbours in Qatar weren’t to be left behind and announced a record deal with Barcelona in 2011. Qatari firms also have key deals signed with PSG while the partly-Qatari owned sportswear company Burrda supplies the Belgian national team.

It is understandable if the focus is on traditional centres of the game like England, Spain, Italy and France but recent moves have seen Qatar and Abu Dhabi also show an interest in other regions which don’t have a similar football culture. They have been making inroads into places like the US, Canada, Belgium, Australia, Japan and Southeast Asia. It seems that going global was always on their agenda, and it was just a matter of time.

For the Abu Dhabi group, it wasn’t too long before they realised that success at Manchester City wasn’t enough. They have since created the City Football Group, a company that will oversee the global network of clubs that City owns shares in. New York City FC was announced as Major League Soccer’s 20th franchise in May 2013, in a partnership deal between Manchester City and the New York Yankees. 2014 saw two more clubs being added to the list: Melbourne City F.C (earlier Melbourne Heart) of Australia and Yokohama F.Marinos of Japan.

While the ventures in the US and Australia represent a major effort to further spread City as a world brand, City will only have a minority stake in the Japanese club. Yet, it is another important step as the owners look to have a foothold all over the world.

The Qataris have chosen a different method of enhancing their global reach; and it is rather peculiar. In 2012, the little-known town of Eupen in southeast Belgium was earmarked as key for Qatar to make a positive name for itself in the world game. The local football team KAS Eupen, from the Belgian second division, was bought by Qatar’s national sports academy ‘Aspire’, in a deal that surprised many.

The authorities running the academy  had it all planned out well in advance though. This anonymous club would be the launch pad for the talented young players that the Aspire Academy had scouted and developed in its centres in Qatar and Senegal. It was something that could always be marketed as ‘Qatar realised the dreams of scores of footballers!’ It would be a massive shot in the arm for Qatar’s image. The officials believed that these players can move on to bigger and better things from there and it could be said that they have been vindicated as one of the players, Diawandou Diagne signed for FC Barcelona B in 2014.

This directly covers the probable cause for this major investment in footballing infrastructure from this part of the world.

When you have businessmen splashing so much cash and investing so heavily in football, it raises the question: are they in here to make some money? It is always probable but not so in this case. Why? Simple, it’s because none of the moves so far show any signs of making money. Although Abu Dhabi and Qatar have well maintained investment activities that try to move away from total reliance on oil and gas, their interest in football doesn’t fall in line with that. Expenditure has far outstripped income at both PSG and Manchester City.

Yet the owners remain steadfast in adding more and more names and investments to their portfolio, making it clear that dough isn’t what they are after. Quite obviously, it is much more about making a name than money. Analysts point to the term ‘soft power’- influence attained by means of diplomacy, international assistance and cultural exchanges etc. It may be the main reason for the Arab spending spree throughout the World of Football; trying to make through Football what can’t be made from politics.

The main question for football is the safety of the Qatari investment. Will they suddenly desert clubs like other benefactors have done in the past? In my opinion, Qataris are here to stay. Because unlike most individual Russian/Thai/Uzbek/Chinese investors, who could succumb to political and financial pressures, the Arab investment is fueled by a national interest.

Even if the Qataris decide to offload a club, they would still worry about the image of their country. They won’t just bail out and leave a club in ruins like at Portsmouth. Besides, the Qataris have also suggested that they are going to invest in infrastructure – stadiums and academies –  as well.

Are they good for European football? On one hand they inflate market prices – though one hopes that Financial Fair Play will reduce inflation. On the other hand, they turn modest or underachieving clubs into real powerhouses, and that’s good for competition.

Either way, like them or not, the Qataris are part of the future of Europe’s football. Their next step will be interesting: Premier League media rights? Player agencies? Manchester United?

All is possible.

FFP regulations state that ‘clubs must not spend more than they earn’ and are designed to keep overspending in check. But PSG and City have, as mentioned earlier, announced million dollar deals with firms that are linked to their owners’ respective governments(amid substantial controversy admittingly). And so, money from state coffers still finds its way to club accounts, albeit now marked as ‘revenue.’

As for the likes of New York City FC, Melbourne City, Yokohama F.Marinos and KAS Eupen, one can hope that Arab investment will be a positive aspect of their history. It could spell benefits for the local community and also give its footballing youth a route to world fame, all because of the extensive influence of their owners and their network. It is why David Villa signed for New York and  then went Down Under to play for Melbourne till New York City FC fully came to life. It is why PSG and Man City visit Qatar and UAE to coach aspiring young footballers.

It may also be why a few years from now, a kid from Yokohama will probably make it big on football’s biggest stages, to be the toast of the world. And then he will probably end up thanking the Arabs.

 

 

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