Belt and Road extends to sport: DDMC chief lets it slip, US$4 billion AFC deal may be part of China’s plan to control world football
- China-Swiss DDMC Fortis joint venture to take over from Lagardere from 2021
- Eight-year deal involves broadcast and marketing rights for Asia’s big events
China’s DDMC, in partnership with Swiss company Fortis, last week signed a deal with the Asian Football Confederation (AFC) for exclusive rights to market the body’s commercial properties for eight years. However, a key line uttered by Dr Yi Rentao, chairman of the DDMC Fortis joint venture, provided a less-than-subtle indication of China’s plans for the future.
“We see this partnership as an opportunity for DDMC to carry out the important ‘Belt and Road’ strategy,” Yi said at the signing ceremony in Kuala Lumpur.
Much can be gleaned from Yi’s linking of the football deal to President Xi Jinping’s “Belt and Road Initiative” (BRI) – China’s multibillion-dollar grand plan to provide infrastructure development across the globe but which has also been criticised as a form of financial colonialism on countries who are unable to pay their debts.
The AFC President signs the historic commercial contract with partners DDMC Fortis which secures the financial future of the game in Asia for a decade.https://t.co/u2V1BovXGD
— #AFCU19 (@theafcdotcom) October 29, 2018
The link may be sending a message that DDMC, which is said to have struggled to pay the first two tranches of its reported US$4 billion commitment to the AFC from 2021 to 2028, will be protected from going down in the same way that Europe-based, China majority-owned MP Silva – previously the world’s biggest sports marketing company – went into administration last month because of a lack of funding.
There is also the suggestion that while the Chinese government has clamped down on unnecessary global investments in sport, the DDMC’s BRI platform may give it special status and a proxy to strengthen China’s influence over Asian football and, eventually, Fifa.
“At one level, my feeling is this is a cunning political sleight of hand on the part of DDMC,” said Simon Chadwick, professor of sports enterprise at Salford Business School. “Over the last 18 months, the Chinese government has been clamping down on what it believes to be errant investments in football, especially when they have an overseas dimension.
“As such, Beijing issued a diktat in which it was stated that future football investments must be connected to BRI. Hence, it appears that DDMC may have packaged and positioned the deal in order to ensure that it survived the scrutiny of China’s authorities.
“At another level, though, the deal renews the message that China remains committed to becoming a global force in football, not just in playing terms but also commercially and politically. The DDMC deal is reminiscent of relations between Wanda-owned Infront [Sports & Media], and of the numerous deals that Chinese companies now have with Fifa. These kinds of relationship create a financial and organisational dependency whereby the commercial partner can begin exerting political influence.
“One suspects that Chinese interests are playing a long game; by building influence inside the AFC, China will be in an even stronger position to influence Fifa.”
The DDMC deal means the imminent end of AFC’s relationship with Lagardere Sports and Entertainment that goes back to 1993.
In August, Malaysian prime minister Mahathir Mohamad, during a visit to Beijing, told China in no uncertain terms that “we do not want a situation where there is a new version of colonialism happening because poor countries are unable to compete with rich countries” as he cancelled two major China-financed infrastructure projects in his country.
Sri Lanka has already been forced to hand over control of a deep-water port to a Chinese company because the country is struggling to make payments.
AFC president Sheikh Salman bin Ebrahim Al Khalifa hailed the deal as a new era for football in Asia.
“I am grateful to DDMC Fortis for the confidence and trust that they have shown in the current success and future potential of the Asian Football Confederation. The game in Asia has never been in a better position and we should cherish that,” said Salman.
Wuhan-based DDMC is a culture, sports and entertainment company in China listed on the Shanghai Stock Exchange while Fortis Sports is a sports marketing firm founded in Switzerland.
“DDMC Fortis was created specifically for the purpose of delivering this prestigious mandate for the AFC,” Yi said.
“By combining the global market expertise of the two companies we are in the position to take Asian football to the next level and kick-off a golden decade of growth.”
DDMC Fortis’ contract entails the broadcast and commercial rights for all AFC competitions, including the AFC Champions League, Asian Cup and Asian World Cup qualifiers from 2021 to 2028.
This year, DDMC bought the domestic broadcast rights for Spanish football from the start of the 2017 season until 2022 and paid US$500 million to buy Super Sports Media, which holds the Chinese rights for the English Premier League.