A second division Spanish club taking a small stake in a third division Chinese club won’t make global headlines, but it could see the start of a wave of foreign investment in Chinese football, now that outbound acquisitions have effectively been stopped.
A year ago, Chinese companies were rushing full steam ahead to invest in – or buy outright – soccer clubs from around the world. From Aston Villa and West Brom to Espanyol and Inter Milan, the first waves of investment appeared to herald many more deals. This headline in The Telegraph from September last year, for instance, claimed that another 30 Chinese billionaires were looking to buy clubs.
How quickly things change.
Late last year, some leaked policy guidelines implied that restrictions on capital outflows were a greater priority to the Chinese establishment than advancing the President’s football agenda, at least as far as foreign acquisitions were concerned. For those not seeing the initial signs, a number of senior Chinese officials have stated this more explicitly in recent weeks:
Pan Gongsheng, head of the State Administration of Foreign Exchange (SAFE) hit out at Chinese firms for using overseas club acquisitions as a cover to transfer assets overseas, saying these M&A deals “can resemble roses among thorns”.