FIFA plays the China card

• by Paul Kennedy  @pkedit, Mar 21, 2016

In conjunction with its first executive committee meeting since Gianni Infantino was elected president, FIFA tried to make the case that the past is the past, and it was putting years of scandal behind it and beginning to work out of the financial hole it dug itself into. That included the announcement of China's Wanda Group as a top-tier sponsor through 2030. But almost immediately, the deal raised questions.

Dalian Wanda Group is China's biggest commercial property developer that has expanded into other fields, including sports and entertainment. One of the companies it purchased is Swiss sports marketing company Infront Sports & Media, whose former chief executive is Philippe Blatter, nephew of disgraced former FIFA president Sepp Blatter.

Another was World Triathlon Corporation, which Wanda purchased from Providence Equity Partners, the U.S. fund invested in MLS marketing firm SUM. A third company was the endurance sports division of French firm Lagardere Sports & Entertainment.

Several red flags have been raised. FIFA chose Infront to sell the 2018 and 2022 World Cup broadcast rights in 26 Asian territories, including China. The sale of soccer media rights to third parties and what they did with them has been at the heart of the corruption charges involving Concacaf and Conmebol events and FIFA's World Cup (qualifying and the finals). In addition, Philippe Blatter was hired by Wanda to be the chief executive of Wanda Sports Holding.

“It is obviously an important strategic partner for the future,” said Infantino said of Wanda. “I am very well aware of the potential situations that can exist when you have partners who may have subsidiaries with commercial relations."

Wanda is different from other main FIFA sponsors that generally operate in specific markets: Adidas (sports equipment), Coca-Cola (soft drinks), Gazprom (gas), Hyundai (automobile) and Visa (financial services). Wang Jianlin, Wanda chairman and China's richest man, was up front in acknowledging the opening the FIFA scandal has offered Chinese firms and their goals in promoting Chinese interests. In that regard, Wanda is most closely similar to Gazprom, which has worked to promote Russian national and soccer interests.

"Two or three years ago," Wang said, "Chinese and Asian companies probably wouldn't even have had a chance to sponsor FIFA even if we wanted to. But because some western companies dropped out, we got the opportunity. To my knowledge, another Chinese company will become a FIFA top sponsor soon. If there are no surprises, there will be three Chinese top-level sponsors by the end of the year. If more Chinese brother companies become FIFA sponsors like Wanda, we will join forces to advance the interests of China soccer."

One of the Chinese goals is to host the World Cup for the first time. Sepp Blatter's plan was for Russia to host 2018, the USA 2022 and China 2026 when the executive committee voted on 2018 and 2022 in 2010. Michel Platini and others threw a monkey-wrench into those plans when they voted for Qatar as 2022 World Cup host.

"As a partner of FIFA, Wanda will be better placed to play a role in the bidding process to host major football events such as the World Cup, closing the gap on international football and enabling Chinese football to have a say in international football,'' Wanda said in a statement released after Friday's announcement.

Just when China will be able to bid remains to be seen. Current World Cup bidding rules call for all FIFA members except those from the confederation of the most recent host country to be eligible to host the next World Cup. That would rule out China in 2026, but it should be noted the bidding rules have already changed once. They previously excluded members from the confederations of the two most recent host countries.

One of Infantino's election pledges was to re-open the 2026 World Cup bidding process as soon as possible. It should be on the agenda at the next FIFA executive committee meeting on May 9-10 in Mexico City. The bidders are expected to include the USA and Concacaf neighbors Canada and Mexico.