Milan, the birthplace of Dolce and Gabbana and Alfa Romeo, is a quintessentially Italian city. But in recent years, if you attended the storied Derby della Madonnina, the match where the city’s soccer rivals face off, one thing might have stood out: each team has had Chinese investors.

In 2016, the Chinese appliance giant Suning bought a majority stake in Inter Milan — one of the most storied names in Italian soccer — for close to $300 million. A year later, Chinese investors spent more than $1 billion to buy and further develop its intra-city rival, AC Milan, from Italy’s former prime minister, Silvio Berlusconi.

Chinese investors have also bought stakes in the British soccer team Aston Villa, Spain’s Atletico Madrid and Slavia Praha, one of the top soccer teams in Czechia, the former Czech Republic. And wealthy Chinese businessmen have spent generously, singing global soccer stars to huge contracts to lure them to play professionally in China.

Indeed, over the past decade, China — an Olympic powerhouse that has struggled to build its own professional sports leagues — has quietly become a major player in global sports, with growing influence in the NBA, FIFA and the International Olympic Committee. In just the past five years, Chinese investors have spent more than $10 billion on sports broadcasting rights, team sponsorships, investments in overseas soccer and basketball clubs and stakes in sports apparel brands according to an estimate calculated by The Wire. 

And while few realize it, two uniquely American brands — Wilson tennis rackets and the iconic Louisville Slugger baseball bat brand — are now, effectively Chinese-owned.

“These deals make sense not only as sports investments; It’s also because these companies also have global ambitions” says Liu Dongfeng, a dean at Shanghai University of Sport. “Sports can be a bridge and a platform to facilitate their international investment,” he adds.

China’s fast-growing companies have been scouring the globe for deals for nearly two decades, seeking to invest in energy projects, mines, hotels, high-rise properties and technologies that can help upgrade the country’s economy and move it away from its dependence on low-priced exports.

As Chinese firms have grown richer, they’ve also gravitated towards investing in film, entertainment and sports assets. The push has also come with enormous support from the Chinese government, which has vowed to build China into a sports powerhouse, as the nation prepares to host the 2022 Winter Olympics in Beijing.

In 2014, China’s State Council, one of its leading political bodies, announced plans for the country to move towards becoming a sporting power by 2025. The goal is partly aimed at developing home-grown athletes. There are also major efforts under way to host international events and give the country and its representatives a greater say in the governing bodies of global sports leagues and events like the World Cup and major golf and tennis tournaments.

To some extent, a great deal of state and private investment has been directed towards developing a strong national sports industry. In September, for instance, the State Council called for getting 300 million Chinese to participate in winter sports by 2022, the year China hosts the Winter Olympics in Beijing.

There’s already strong interest in other sports. The Ministry of Education, for instance, is teaming up with the NBA to create basketball camps throughout the country. And the Evergrande Group, one of China’s biggest property developers, runs the world’s biggest soccer schools, according to its website. Evergrande also co-owns a professional Chinese soccer team with the Alibaba Group. In April, construction got underway on the team’s 100,000-seat stadium, intricately designed in the shape of a lotus flower. When it is completed, it will rank among the world’s largest arenas.

But China has rushed to develop a presence in international sports as well.

Chinese companies have poured billions of dollars into sponsorships with FIFA, the governing body of international soccer, according to analysts. A handful of Chinese firms, including the Wanda Group, a Chinese property and entertainment giant, the appliance maker Hisense, dairy giant Mengniu, and the smartphone maker Vivo — spent a combined $835 million on advertising for the 2018 World Cup, over a third of total spending, according to the Ispo, a sports trade fair organizer.

Wanda is a FIFA partner, “the highest level of sponsorship,” through 2030, alongside the five other multinational corporations, including Adidas and Visa.

“FIFA is becoming dependent on Chinese sponsorship revenues,” says Simon Chadwick, the director of the Centre for the Eurasian Sport Industry at Emlyon Business School, which is based in Shanghai. That leverage may help China clinch a bid to host the 2030 World Cup, he adds, noting that FIFA changed its policy of rotating continents such that China would be eligible to bid for that tournament.

China’s wealthiest entrepreneurs are well aware that the country’s top leader, Xi Jinping, is an avid soccer fan and has expressed a desire to see China play a role in the World Cup.

There have, of course, been some setbacks.

Worried about “irrational” overseas investments, in 2017 Beijing began cracking down on Chinese firms that used state money to aggressively spend on overseas assets, including purchases of sports and entertainment properties. Following that effort, the Recon Group sold its stake in Aston Villa, and Wanda sold its interests in Atletico Madrid and the Ironman Group, which it had purchased for $650 million five years earlier.

Still, China’s global sports footprint is bigger than ever.

Chinese companies, for instance, are now major sponsors of the International Olympic Committee. The country hosted the summer games in 2008, and will host the winter games in 2022. Alibaba, for example, paid $800 million to become a global “strategic partner” of the IOC through 2028, according to Bloomberg News. And last year, Shanghai-based Hengyuanxiang Group signed a deal with the IOC to become the official uniform supplier for the Tokyo and Beijing games.

Among the Chinese sponsors of the 2022 Winter Olympics is iFlytek, a voice recognition software company that the U.S. government blacklisted last October over concerns that its camera surveillance systems were implicated in human rights abuses in Xinjiang, where authorities have placed Uighur minorities in internment camps.

The decision to blacklist an Olympic sponsor highlights one of the challenges Chinese entrepreneurs have faced “going global,” and seeking to make deals in the U.S., Europe or with global sports bodies: politics tends to interfere.

The U.S., Europe and Australia have begun tightening controls over Chinese investments in technology. The U.S. has an ever expanding list of Chinese firms on its sanctions list, and incidents like the Chinese government’s fury with the NBA have injected politics into the world of sport.

Even if the Chinese investments are market-oriented, there are growing suspicions internationally that China has ulterior motives. For instance, when the Chinese entrepreneur Ye Jianming and his military linked privately run oil company CEFC bought Slavia Praha in Czechia, it came as part of a concerted effort by CEFC to cozy up to Czech officials as Xi Jinping was seeking to improve relations.

(Ye was an advisor to the Czech president and joined Xi on a visit to Prague in 2016, but has since been detained on corruption charges and his firm was seized by the state).

And Chinese state-owned enterprises have a long track record of building and financing sports stadiums as a form of diplomacy, and such projects often accompany trade deals or improved relations.

In 2007, for instance, months after Costa Rica cut diplomatic relations with Taiwan and established them with the People’s Republic, China agreed to build the Central American country’s $105 million national stadium. And in 2016, while Chinese state-owned construction firms were building two soccer stadiums in Gabon, for the African Cup of Nations, the countries signed a “comprehensive cooperative partnership.” That year Gabonese oil exports to China nearly tripled, making China the largest importer of oil from the Central African country.

Foreign sports leagues have also jumped into China’s market, with the help of Chinese companies and the state — hoping to cash in on the growing popularity of sports in the world’s second largest economy.

“For any sports organization, their number one market will be the domestic market, but the second or third will be China,” says Tom Elsden, business director at Mailman, a global sports digital agency in Shanghai.

The NBA has long been the most popular league in China, and it does billions of dollars of business in the country. In 2019, Tencent, one of China’s online and gaming juggernauts, signed a $1.5 billion deal with the league for streaming rights. The NBA and its players have also cashed in on the interest of a growing number of Chinese sports apparel makers, like Li-Ning, Anta and Peak.

European soccer is also profiting. In 2016, the English Premier League signed a three-year rights deal with the Chinese streaming service PP Sports for $700 million, according to Reuters. And Germany’s Bundesliga followed suit two years later with a five-year arrangement. Last August, La Liga sold its broadcasting rights to iQiyi, the streaming service partly controlled by the Chinese search engine giant Baidu.

Other leagues are also trying to break into the Chinese market, although some face an uphill battle because their sports, including baseball, hockey and American football, which are not yet widely followed or played in China.

Professional hockey has received a boost from Beijing-based ORG Technology, a metal packaging specialist that counts Coca-Cola, Red Bull, and Tsingtao Brewery among its clients. The company began sponsoring a handful of NHL teams and training programs within China in 2015, because of its chairman’s love of the sport, according to its website.

The NHL went on to host preseason matches in Beijing, Shanghai, and Shenzhen, and analysts expect the 2022 Winter Olympics will boost Chinese interest in the game.

Major League Baseball and the NFL have also been courting China, with limited success. Alibaba’s streaming service, Youku, bought NFL media rights in 2018, and its Tmall hosts the league’s official merchandise store in China.

MLB has been recruiting players and seeking deals in China. The league’s ties to China got a boost, though, when Anta — the Chinese sports brand — led a group of investors, including Tencent, and paid $5 billion for the Finnish sporting goods brand Amer Sports, which produces Wilson tennis rackets and Louisville Slugger baseball bats, the official bats of Major League Baseball.

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