From the Gulf states to Russia: The Growth of State-Owned Football Clubs

 by Owen McGovern

On October 7th 2021, Mike Ashley, then-owner of Newcastle United FC, sold his stake in the club for £300 million to the Public Investment Fund (PIF), a Saudi Arabian consortium chaired by Crown Prince Mohammed Bin Salman worth around £500 billion. This created a media firestorm, with some relishing the departure of the much-reviled Ashley and the arrival of more ambitious owners, while others were wary of the new ownership’s links to the Saudi regime, which ranks 156th in the world on the democracy index and in the bottom 12 on Freedom House’s Global Freedom Index. Also reignited was the debate on whether state-controlled organisations should be able to own football clubs, which takes place all over the world. The Newcastle takeover also sparked renewed public interest in the case of Jamal Khashoggi, a Saudi Arabian journalist who was murdered by the Saudi government, alleged on Bin Salman’s orders, as well as various human rights abuses.

However, the PIF is far from the first overseas investor in football; in fact other Gulf states also have a degree of ownership over several European football clubs. The most famous of these investors is Mansour bin Zayed al Nahyan, commonly known as Sheikh Mansour, who is Deputy Prime Minister of the United Arab Emirates and the owner of Manchester City FC. Sheikh Mansour, who took over the club in 2008, has since overseen the spending of £1.5 billion in the transfer market, a figure nearly £500 million more than that of rivals Manchester United, who are one of the richest and most successful clubs in history. The Emirati politician and businessman also founded the City Football Group, a company designed to administer both Manchester City and the eight other clubs the CFG owns, including the likes of New York City FC, Mumbai City FC, and Spanish side Girona. The CFG have stated they intend to invest in clubs in countries where rapid growth in football is expected, such as China and India. Many of the CFG’s clubs also sport the group’s signature sky-blue kits, accompanied by the sponsor logo of Etihad, an Emirati national airline. The other national airline of the UAE, Emirates, also makes regular appearances during football games, sponsoring the shirts of clubs like Real Madrid and Arsenal with the tagline ‘Fly Emirates’, as well as French side Paris Saint-Germain.

Qatar has been the second Gulf state to have invested in football. Qatar Sports Investments, controlled by the Qatari government, purchased Paris Saint-Germain in 2011, pledging that the club would win the Champions League, a promise which has not yet come to pass despite PSG being made the then-richest club in the world by the takeover. PSG has however experienced unprecedented domestic success in France, winning seven league titles. This was primarily due to heavy investment from QSI, with Brazilian star Neymar joining the club from Barcelona in 2017 for a record-breaking fee of €222 million. In total the Qatari ownership have spent £1.3 billion in the transfer market since the takeover, while the next biggest spenders in that period, Olympique Marseilles, have spent less than a third of that amount. However, all of these governments have come under criticism for their perceived attempts to use “sportswashing” to make their regimes appear more favourable to the average person, with Manchester City and Paris Saint-Germain being particularly notorious not only due to their owners’ business practice being to simply outspend the competition, which is seen as buying success.

If you were to travel to Eastern Europe, in contrast, there would be a very different idea of a ‘state-owned’ football club. In much of the region, many football clubs are owned and operated by their respective governments. One such example is FC Lokomotiv Moscow, who were founded in 1922 by Soviet railway workers, who brought together the best footballers from the Moscow train lines. It quickly fell under the control of the Soviet Ministry of Transportation, specifically Russian Railways. During the Soviet era the club was not overly successful, finishing as runners up in the Soviet Top League once in 1959. However, the dissolution of the Soviet Union in 1991 left established clubs, such as CSKA Moscow, floundering, allowing Lokomotiv to fill the power vacuum and become the ‘fifth wheel on the Moscow cart’. Lokomotiv Moscow have since won the Russian Cup nine times, and are one of only three teams to have remained in the top flight of Russia since 1992. To this day they are still wholly owned by Russian Railways, now a state-run company whose biggest and only shareholder is the Russian government. 

Another country with widespread state ownership of football clubs is China. Shandong Taishan, from the Chinese city of Jinan, is owned by the State Grid Corporation of China, which in 2020 was the world’s second largest company by revenue and has nearly 950,000 employees. Shandong were founding members of the Chinese Super League in 1994, and have since won the league four times, most recently in 2010. This wealth has allowed Shandong, like many Chinese clubs, to sign valuable players from abroad, such as Marouane Fellaini, a former Belgian international midfielder with over 250 Premier League appearances. High profile signings like that of Fellaini have resulted in global recognition of the Chinese Super League, which currently boasts the sixth-highest average attendance out of any football league in the world. 

Although many would expect to see state-owned football clubs in less democratic nations, such as China, the former USSR or even North Korea, it can escape the attention of some that many football clubs under the ownership of entire countries successfully operate much closer to home. Furthermore, while the number of clubs owned by their respective countries’ governments has dwindled, there has been a steady increase in clubs owned by foreign states, a trend which looks to continue in the near future.