Global Trade in Footballers Hits Record $6bn in 2017

By Elliot Bullman

Football transfers were catapulted off the sports pages into the global media spotlight this year when Paris St-Germain broke - or rather smashed - the world record fee to snatch Brazilian star Neymar from Barcelona this summer.

football 452569_960_720

The French clubpaid an eye-watering 222m euros ($260m) for the player, more thandoubling the previous record set when Paul Pogba returned to Manchester Unitedfrom Juventus for £89m in August 2016.

But that very prominent deal was just the very visible peak of a huge industry, namely the international trade in football players, which is becoming more and more of a global business.

Latest data from Fifa, the sport's governing body, show there have been 15,291 international transfers so far in 2017, with total spending on players hitting a record $6bn (£4.58bn).

psg team .pngPhoto Credits: Website Frenchly

International transfers are ones where a player moves from one country to another, as opposed to domestic transfers which take place between two clubs in the same country.

That record figure - which is unlikely to change by the end of the year as player transfer windows in the biggest European leagues are not due to open again until January 2018 - is a 25% increase on the $4.8bn spent in 2016.

'Chinese spending'

"There are two driving factors behind the soaring spending," says Harry Philp, a football finance expert at London-based Portland Advisers.

"The first is the emergence of China and the huge transfer fees that they are prepared to pay, and the second is the fees English Premier League clubs can spend thanks to their ever more lucrative TV deals.

premier leaguePhoto Credits: WebsiteTSM Plug

There has been a huge increase in investment in Chinese football in recent years, kicked off by President Xi Jinping's plans to turn China into a great footballing nation, one that one day might host and ultimately win a World Cup.

Indeed, Chinese clubs spent a whopping $451m on football players last year, an increase of 168%. That made them the fifth biggest spenders in the world after England - where clubs splashed out $1.37bn on global stars - Germany, Italy, and Spain. These factors are driving up the value of the global market.

Free agents

Most of the transfers discussed in the global media involve large transfer fees, but in reality, only a small percentage of all worldwide transfers involve the payment of a fee.

The majority of deals are players who have become free agents finding a new club.

free agent

"Transfers out of contract remain the most popular type of international transfer," says Fifa. They are even more common for older players - in 2016, more than 90% of the international "transfers" of players older than 32 were out of contract.

Loan deals account for another proportion of transfers, and there have been accusations that clubs such as Chelsea, and to a less extent Manchester City, are scouring the globe for top young talent to stockpile.

chelseaPhoto Credits: WebsiteThe Sports Bay

They are then put out on loan to see how they develop," says Mr Philp. "A small proportion will make it into to the first team, and the rest of the pool of talent can be sold on, usually at profit. This provides revenues for the clubs to then buy one global top star player, and also to assist in compliance with financial fair play.

"These clubs are trading players, almost running what I would call 'asset-management businesses'."

pexels photo 262524

"Financial fair play is meant to control the transfer madness," says Mr Philp. "But if revenues are going up, whether through TV monies in the Premier League, or at PSG via Qatari investment - however that is being structured - then transfer fees and player wages will continue to climb.

With January transfer trading windows opening in the biggest five European leagues including England - as well as in China and Brazil - it means players, clubs and agents will already be gearing up for a frenzied period of global trading that could see spending leap even further ahead during 2018.

RELATED NEWS

  • North Korea threatens to cancel Trump summitNorth Korea threatens to cancel Trump summit
  • AMLO’s win could be a landslide with congressional majority: UBSAMLO’s win could be a landslide with congressional majority: UBS
  • Google and Facebook, big winners after ban on sports betting was overturnedGoogle and Facebook, big winners after ban on sports betting was overturned
  • Would you pay your ex a Would you pay your ex a 'break-up fee'?
  • Why Trump suddenly reversed course on sanctions against Chinese tech giant ZTEWhy Trump suddenly reversed course on sanctions against Chinese tech giant ZTE
  • Are you ready for retirement? Here’s how to know.Are you ready for retirement? Here’s how to know.
  • Tariffs on steel for Mexico and Canada will depend on NAFTA: RossTariffs on steel for Mexico and Canada will depend on NAFTA: Ross
  • Sergei Skripal reportedly briefed European intelligence agencies about RussiaSergei Skripal reportedly briefed European intelligence agencies about Russia
  • The EUThe EU's billion-dollar deals at risk in the Iran nuclear deal
  • Pompeo: U.S. firms could invest in North Korea and Kim may get ‘security assurances’Pompeo: U.S. firms could invest in North Korea and Kim may get ‘security assurances’
  • 'Unauthorized transfers' siphon funds from Mexican banks: central bank
  • RBS is swallowing a RBS is swallowing a 'milestone' $4.9 billion fine for its role in the financial crisis — and shares are going up
WATCH LIVE TV



Most Read Articles
Most Watched Videos
  • Generations Riviera Maya
  • Mayair

Language

Mexico News Network
All rights Reserved 2018