The crisis now unfolding in Turkey’s Super League reflects the nation’s wider economic problems
Turkish football has become increasingly ambitious, dysfunctional and over-leveraged – and now the bubble has burst
Strange things have been happening in Turkish football this year. Fenerbahce’s 3-0 away defeat by lowly Akhisar earlier this month marked a new nadir in the Istanbul club’s 111-year history. The humiliating beating left Fenerbahce mired in the Super League’s relegation zone, and the club’s president, Ali Koc, so disgusted that he refused to let the team fly home. Instead, they were forced to make the 300km-plus journey back from the western province of Manisa by bus.
Fenerbahce’s problems are particularly dire, but its bitter local rivals Besiktas and Galatasaray are also nowhere near the top of the table. While many smaller teams are thriving in an unpredictable season, the so-called “big three” are struggling. It’s an almost unthinkable predicament for clubs who, between them, have won the vast majority of Turkish titles and are supported by 80 per cent of the country’s fans. In October, thousands of Fenerbahce supporters refused to leave the stands after a match, and hundreds gathered at the club’s stadium after the Akhisar game to angrily demand a new coach.
While each side has its own unique problems, the biggest Turkish clubs are all labouring under crippling debt, caused by overspending and a lack of accountability. Aspirational, dysfunctional and perilously over-leveraged, the Super League holds many parallels to the wider national economy. In fact, the two are inseparable.
Football is one of Turkey’s most important networks of power and one of its most prominent globally facing institutions. The vast majority of clubs are member-based associations, which elect their president – a position that includes the management of finances, the development of infrastructure and the appointment and frequent sacking of coaches – for two or three-year rolling terms. Becoming a president of one of the big clubs offers a golden ticket to hob-nob with politicians, bankers and wealthy businessmen. While many presidents are deeply committed to their teams, the unusual structure of Turkish football also provides ample opportunity for skullduggery, especially given that the clubs are curiously exempt from basic commercial oversight.
Instead of developing young talent and investing at grassroots level, ambitious presidents – under pressure from fans and the media – frequently bring in ageing foreign stars for inflated sums. Take, for example, Robin van Persie’s contract with Fenerbahce, signed for an undisclosed fee in 2015, on a salary of about €4.9 million (Dh20.63m) per season, and cancelled in January this year. Doing so allows presidents to make splashy headlines, safe in the knowledge that they can always walk away and leave the financial fallout to whoever succeeds them.
Revenues have soared in Turkish football over the past 20 years. However, increased cashflow has fuelled out-of-control borrowing and transfer spending that has left many clubs in catastrophic financial straits. This crisis reflects greater national concerns.
During an increasingly autocratic 16 years in power, President Recep Tayyip Erdogan and his Justice and Development Party (AKP) have set about transforming Turkish society. Mr Erdogan has vowed that by 2023, the centenary of the modern Turkish republic, the country will join the world’s top 10 economies. In the AKP’s first terms, Turkey experienced record levels of growth. Mr Erdogan – himself a former semi-professional footballer – has used construction as an engine of progress and prestige, creating millions of jobs for a loyal conservative base in the process. Since 2002, airports, bridges, roads, hospitals, shopping malls, transport networks, thousands of mosques, and at least 30 new football stadiums in 27 cities, have sprung up.
Many of the AKP’s mega-projects have been lambasted for their detrimental environmental impact and their over-ambitiousness. Just as Istanbul’s third Bosphorus bridge has been slammed for destroying fast-shrinking forestland and being underused since its opening, many football stadium projects have been criticised for capacities that vastly exceed their attendances. Most new stadiums are typically located far outside cities, while their former sites have been given over to favoured businesses.
And now, Turkey’s economic bubble has burst. Growth has slowed, the lira has severely weakened, inflation is rising, youth unemployment is high, cronyism and corruption are ever more evident, and an over-reliance on foreign money has left the country acutely vulnerable. Construction companies that took on huge loans, and the banks that issued them, now face spiralling debts. Similarly, when the lira lost 40 per cent of its value against the dollar earlier this year, the value of the big football clubs’ debts – most of which are held in foreign currencies – rocketed.
In 2000, the combined debt of Turkish Super League clubs was around €60m (Dh253m), while total annual revenues were €150m (Dh632m). Now, this figure stands at more than €2.3 billion (Dh9.7bn) – around four times total annual revenues. Fenerbahce’s total debt alone is around €621m (Dh2,616m).
In recent years, several smaller clubs – including Mersin Idman Yurdu, Gaziantepspor and Kardemir Karabukspor – have all but imploded, but reports of the imminent demise of Turkish football are greatly exaggerated. When the game is in trouble, the state simply bails it out, writing off massive tax bills – particularly those of the biggest clubs – using its influence to cajole and secure sponsorship, and leveraging credit from banks. Many economists also believe that football broadcasting revenues have been artificially inflated, thanks to the government pressurising companies to bid.
Little of that money has gone towards rebalancing the books or sensible longer-term development. The AKP has done almost nothing to make Turkish football more transparent and accountable. But now, Uefa’s Financial Fair Play (FFP) regulations are starting to bite. FFP was introduced in 2010, in an attempt to stop football clubs spending more than they earn. Uefa has FFP agreements with several Turkish sides. These have effectively hobbled the transfer spending of the heavily indebted big three.
In 2016, Galatasaray received a one-year ban from European competition for violating FFP rules. In 2017, Andrea Traverso, Uefa’s head of club licensing and FFP, stated that Turkey is the only European country where club debts and liabilities are bigger than club assets. In June 2018, Uefa fined Galatasaray €6m (Dh25.3m) for not complying with its break-even requirement, and issued warnings to Fenerbahce and the Black Sea club Trabzonspor for only partially fulfilling their respective obligations. Realising that Uefa is serious, and now terrified of further sanctions, the big clubs have been selling off their best players – see Galatasaray’s sale of Bafetimbi Gomis to the Saudi Arabian club Al Hilal, and Besiktas offloading Cenk Tosun to Everton earlier this year – and failing to adequately replace them.
The weakening of the big three has made the Super League much more competitive and offered smaller teams a rare chance of glory. The most obvious beneficiary has been Istanbul Basaksehir, which is now enjoying a healthy lead at the top of the table. Basaksehir is a private firm, owned by several pro-government shareholders. With only a tiny following, it does not have to make transfers to satisfy impatient fans. It is also not subject to the internal presidential election cycle of most clubs and does not have huge debts to contend with.
However, a league title for Basaksehir, seen by most fans as a manufactured government project, is likely to trigger existential angst on Turkish terraces. Growing austerity within the Super League may also drive wider decline, making fewer top-tier international players willing to move to Turkey and clubs, consequently, less competitive in Europe.
A period of hardship could, on the other hand, save the troubled Turkish game, forcing clubs to develop domestic talent instead of resorting to uncontrolled spending and ever-increasing debt. The current presidents of the big three certainly appear more responsible than many of their recent predecessors, so there is hope.
Ultimately, the major clubs are probably too big to fail. Provided that the nation’s economic problems do not get worse, the government is likely to keep bailing them out. However, this is clearly no way for a once-vibrant and globally respected football league to sustain itself. There is plenty of blame to be passed around for the current state of Turkish football, and the clubs are ultimately responsible for the situation they have found themselves in, but the hubris and short-termism of Mr Erdogan’s economic policies have also played a crucial role.
Patrick Keddie is the author of The Passion: Football and the Story of Modern Turkey
Updated: December 20, 2018 02:18 PM