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What the Chinese Super League teaches us about China

This article can also be read at Asia Times

Forget the choreographed yawnfest wrapping up in Beijing right now. For any understanding of the Chinese model of development, one might as well behold a Beijing sunset, in all its glorious opacity, as try to make sense of the Communist Party’s smoke signals. Alternatively, one might ponder a prominent undercurrent – a meme, if you like – of Chairman Xi’s Chinese dream: football. As the 2017 Chinese Super League season draws – wheezing, limping, splint-shinned – to a close, here are some takeaways.

#1 In the grander scheme of things, the Chinese still aren’t all that interested in watching Chinese football. While the growing market in China for European football – notably the English Premier League – has put the latter’s marketing warlocks in a froth of activity, average attendances at CSL matches haven’t risen enormously in recent years, despite an ongoing whirlwind of interest from Xi and a regiment of newly-minted Chinese billionaires. In a nation of 1.4 billion, the average CSL game in 2017 drew around 24,000 spectators, which is actually respectable by European standards, but once you strip out a handful of top sides, that figure falls away significantly. An absence of quality on the pitch remains a factor, but so too does the fact that China only got a proper league going in 1994 and has now set itself the task of building a sporting imperium from the top down. The league lacks domestic heroes, folklore, a sense of history and – barring some emerging needle between Shanghai SIPG and Shanghai Shenhua – meaningful rivalries.

#2 The suspicion that there may be something pyramid-shaped about Chinese football has yet to be dispelled. Some of China’s richest men have put very large sums of money in, without the league developing any kind of sustainable revenue streams. Seemingly sold on the promise of jam tomorrow, China Sports Media Ltd (CSM) acquired broadcasting rights to the CSL in 2015, agreeing to pay 8 billion yuan (US$1.18 billion) in instalments over a five-year period. In 2016, the company farmed online broadcasting out to the tech giant LeEco in a two-year deal worth 2.7 billion yuan. Owing to a “cash crunch,” however, LeEco, in turn, sold its 2017 rights to the video streaming site PPTV for 1.35 billion yuan. Then, in July this year, CSM – after withholding its 2017 instalment – announced it is seeking to extend the period of its initial deal from five to 10 years, complaining that new regulations (see #3, below) from the Chinese Football Authority (CFA), a government supervisory body that is the largest shareholder in the CSL, hurt its ability to recoup its investment. Could it be that the projected subscriber base just doesn’t exist?

#3 The current campaign has been, in one respect at least, the proverbial season of two halves. In the winter transfer window, CSL clubs shelled out some jaw-dropping sums to acquire players that have been big names in the global game. Shanghai Shenhua’s capture of Carlos Tevez, regarded a decade or so ago as one of football’s finest strikers, in a deal that reportedly made him the world’s highest-paid player, on an annual salary of $41 million, raised eyebrows among aficionados everywhere. SIPG’s signing of Brazilian midfielder Oscar from English giants Chelsea involved similar levels of cash and suspension of disbelief but at least brought on a player in his prime who could easily be lighting up a higher stage. Others leaving European football for China on tidy contracts included Belgian international Axel Witsel; another former Chelsea man, Nigeria’s John Obi Mikel; and Brazilian forward Alexandre Pato.

The CFA had, in fact, already signaled its dissatisfaction with the influx of money-grabbing foreign talents by reducing the number of overseas players teams can field in a game from four plus a substitute to three. Then, in June, came the coup de main – overseas transfers in the mid-season window would carry a 100% levy. If a club paid less than 45 million yuan ($6.63 million) for a player, the same amount again would have to be put into the club’s own youth system; if more, then a matching sum would have to be rendered unto Caesar, or rather the state’s football development fund.

The whole idea is to nurture more young Chinese players – a laudable aim, but one hedged in by commercial imperatives that create something of a Catch-22. If the league is banking on foreign stars, however superannuated, for box-office appeal, then what happens to the whole enterprise if they’re removed from the picture? It’s unclear if the rule will remain in place for next season or what impact it might have in the long run. But certainly, summer signings were significantly more mid-market, which is probably a good thing, as teams built around a small nucleus of bling-encumbered big-shots famously struggle to find balance. Tevez, incidentally, has been utterly useless, scoring just three goals in a meager 14 appearances to date.

#4 Similarly, it’s no longer enough just to appoint a European or South American manager and expect success on a plate in the CSL. OK, Guangzhou Evergrande have just sealed their seventh straight league title, and their second under former Chelsea and Brazil coach Luiz Felipe Scolari, and SIPG have had a good season under another former Chelsea manager, Andre Villas-Boas – they will finish second in the table and got to the semi-finals of the Asian Champions League. But other foreign coaches have fared less well this term. Beijing Gouan showed Spaniard Jose Gonzalez the door in June, after just six months in the job, and Shenhua – who sit a lowly 12th in the standings – parted company with Gus Poyet (yeah, he used to play for Chelsea) last month. Fabio Capello, hugely successful at the helm of AC Milan back in the 1990s, took over at struggling Jiangsu Suning in June but has only just been able to ensure their top-flight survival.

#5 As one might expect given the mishmash of coaching influences in Chinese football – Italian, German, Portuguese, Brazilian, Korean – and the lack of a tried and trusted formula for the national team, which remains calamitously feeble, there is still no identifiably Chinese style of football. It can be a task getting anywhere near Evergrande’s or SIPG’s Brazilians but games otherwise often seem to have a pronounced physical edge. There is also the occasional dust-up, with the fiercest of them this season coming in an SIPG-Guangzhou R&F clash when a couple of over-enthusiastic interventions from Oscar – for which he was subsequently, and quite unfairly, banned for eight matches – sparked a mass brawl. His team-mates Hulk and Wu Lei were also suspended later for wearing t-shirts supporting Oscar, and Villas-Boas earned his own sanction for an Instagram post that questioned his player’s treatment. The Chinese are all about the rule of law, you understand.

#6 Chinese football displays a glaring lack of transparency in terms of relationships between clubs, their investors, players, fans and the powers-that-be. In July, Jiangsu Suning’s owners – the retailers Suning – were as good as accused of using football to launder money by Chinese state TV. And in the same month, 13 CSL clubs were forced to deny that they were in breach of regulations in relation to unpaid player transfers, salaries or bonuses. Non-resolution, they were told, could see them kicked out of the league next season. Some issued statements denying irregularities; others said they were investigating matters. Then, miraculously, the issue just went away. Who paid what to whom, and when? Cui bono, apart from some young foreign men with tattoos and their agents? Who knows? Perhaps the skies over Beijing hold the answers.

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What’s really driving China’s ambition to buy up Hollywood and win the World Cup?

This post can also be read at SCMP.COM

The globalisation of the film industry is going to mean that “you can’t tell whether it’s a Chinese film or a Hollywood film any more.” That was according to Warner Bros’ CEO and Chairman Kevin Tsujihara last week as he heralded Sino-American co-productions now in the pipeline at Flagship Entertainment, a joint venture involving WB, Hong Kong broadcaster TVB and China Media Capital, the Chinese state-backed investment firm.

Perhaps you are a film fan. If so, how does this make you feel? Do you want to watch films that scramble all evidence of who made them and why – films with nothing to offer in the way of cultural specificity? You don’t? Well, that’s simply inconvenient. Chinese tycoons, in league with enthusiastic American partners, have their sights on establishing new global entertainment empires capable of capturing box office gravy in both East and West alike, and they want your money.

There’s nothing new about people in the entertainment business trying to maximise profits, you might protest, and you’d be right. What’s grating, I think, is the subtle suggestion that this coming together of cash, talent and storytelling – One Script, One Road, if you like – is just one big exercise in global cuddliness.

There have been other deals. Perfect World Pictures last month announced a co-financing partnership with Universal Pictures. Hunan TV is sinking US$1.5 billion into Lionsgate. Huayi Brothers and Fosun International are also investing heavily in American movie ventures. Moreover, the purchase in January of Legendary Pictures (Godzilla, Jurassic World) by the world’s biggest cinema chain operator (and China’s biggest private property developer), Wanda Group, for US$3.5 billion, has been branded “China’s largest-ever cultural takeover.”

U.S. anti-trust laws – look up the Paramount Decrees – are supposed to prohibit ownership of both movies and theatres. Wanda already owned AMC Entertainment, America’s second-biggest theatre chain. Why has nothing been made of this? Cynics might say it’s because the Yanks really, really want direct access to China’s booming box office, which is forecast to outstrip their own in the next couple of years. In that mission, however, they are also likely to find themselves dancing to the tune of the Chinese State Administration of Radio, Film and Television (SARFT), a body whose latest set of rules, targeted at TV producers, amounts to a laundry list of prohibitions, including bans on content that is “to the detriment of national image [or] endangers national unity and social stability”, “exaggerates social problems, displays excess, or shows the dark side of society”, “sets a negative character as a main character”, or “breaks with national sentiment”.

It is inconceivable that the propaganda risks and opportunities associated with inviting Hollywood into the Chinese multiplex have not been weighed by Beijing. Equally unlikely is that Xi Jinping himself has not had a hand in urging Hollywood-bound cash outflows. Establishing a modern consumer society in China that bears at least some of the hallmarks of America’s is a recurring theme of his leadership. One need only consider cinema’s counterpart on Xi’s two-pronged fork of consumerist expansionism to forget the notion that this is entirely about “rebalancing” the economy, however.

That other prong is sport – or, more specifically, football (the proper variety, not the American version). Led by Li Ruigang, a man dubbed “China’s Rupert Murdoch”, in November the very same China Media Capital paid 8 billion yuan (HK$9.5 billion) for the broadcast rights to the Chinese Super League for the next five years. For their part, meanwhile, Wanda last year not only took a 20 per cent stake in the Spanish football club Atletico Madrid but paid US$1.2 billion for the Swiss-based sports marketing company Infront Sports & Media, a company that holds the exclusive sales rights to broadcast Fifa events from 2015 to 2022, including the 2018 and 2022 World Cups.

Until very recently, global interest in the CSL was trace to non-existent. As reported diligently by the Post’s own James Porteous, it has increased somewhat in 2016 as Chinese clubs have taken to offering players double what they’re earning in Europe in a frenzied spree of spending fuelled by that injection of cash from CMC – who are evidently betting on a huge increase in demand for domestic football content and increased interest in the game generally.

To that end, China plans to have 20,000 designated football schools by 2017, raising participation to unprecedented levels. Professing himself a fan of the game, Xi has also made it known he wants China to host a World Cup and ultimately to win one. To be clear, then, the objective is to become a global power in the world’s most popular sport.

In his book Civilisation: The West and the Rest, Niall Ferguson wrote about China trying to replicate the West’s historical va va voom in pursuit of prosperity, or “downloading its best apps”: competition, science, the rule of law, modern medicine, the Protestant work ethic and consumerism. The evidence suggests China has a few problems with its version of the third-mentioned, but in terms of consumerism, well, blockbuster movies and football as drivers of economic growth would seem like straightforward rips.

Only nothing’s as straightforward as Xi might wish. Just as Western moviegoers are likely to vote with their feet and stay away from the kind of films that adhere to SARFT’s worldview, Chinese football isn’t about to become exportable any time soon, and it’s far from certain that the subscription base needed to make the numbers add up domestically will materialise.

Matthew Syed argued in The Times (of London) the other week that Xi’s backing for football is about political indoctrination and control, that it is characterised by “top-down planning and the use of vast (unaccounted for) resources”, and that the paramount leader has rallied tycoons behind his cause in return for political favour.” “The attempt to rise up the rankings, and to stage the World Cup,” he wrote, “is testimony to the growing paranoia of China’s elite. Repression has escalated under Xi as the economy has slowed and propaganda is set to do precisely the same. In that sense, football is a mere pawn in a game of much higher stakes.”

It is certainly true that China’s leadership is facing multiple headwinds: slowing economic growth, shrinking employment, crashing markets, a growing suspicion that serious financial, economic and social problems are being papered over. And indeed, building up the nation’s leisure-industrial complex might be viewed, by the Marxist and the capitalist alike, as a useful expedient via which citizens / consumers can keep themselves (and not the streets) occupied. The official narrative is that buying Hollywood in order to censor it and demanding domination of a sport at which you are currently useless speaks of cultural confidence. It could just as easily be read as stemming from profound insecurity.