FIFA's "Football Marshall Plan" to address coronavirus impact
FIFA is set to use its enormous financial reserves to inject much-needed liquidity into a global football industry struggling due to the coronavirus crisis.
FIFA is currently putting together a “Football Marshall Plan” which will see the governing body deploy some of its $2.7 billion reserve funds to help mitigate the financial impact of the coronavirus crisis on the global football industry.
FIFA understands that football clubs and federations are struggling due to the loss of matchday, television and sponsorship revenues, with some already at the brink of collapse. In its report about FIFA’s plan, the New York Times cites Slovakian club MSK Zilina, a seven-time league champion, which filed for bankruptcy this week; while the Uruguayan Football Federation laid off 400 staff members after the suspension of all football in the country.
Meanwhile, in Spain, four LaLiga Primera Division clubs, Barcelona, Atlético Madrid, Espanyol and Alavés, as well as several clubs from the Segunda Division, have had to put their players and staff on Spain’s temporary redundancy scheme (known as an ERTE in Spanish "expedientes de regulación temporal de empleo"). In the Bundesliga, players will see their salaries reduced by between 20% and 30%, while in Italy, several teams, including Juventus, have agreed to a wage cut. Clubs in the Premier League are also looking to make reductions in their salary bills.
FIFA in a solid position to help clubs
Speaking to Reuters, a spokesperson for FIFA said they were aware of the “serious financial problems" due to the coronavirus pandemic.
“This threatens to disrupt and impair the ability of FIFA’s member associations and other football organizations such as leagues and clubs to develop, finance and run football activities at all levels of the game, including professional, non-professional, youth and grassroots.
“It is foreseen that in many parts of the world a considerable number of persons involved in football including both men and women players will be left in extremely difficult economic conditions.”
The spokesperson said that FIFA had a duty to help clubs and organisations in need due to its robust financial position.
Existential threat
In a letter issued a few days ago, European Club Association (ECA) chairman, Andrea Agnelli, who is also president of Juventus, warned that football clubs face “a real existential threat”.
“As football is now at a standstill, so are our revenue flows on which we are dependent to pay our players, staff and other operating costs,” wrote Agnelli.
“No one is immune and timing is of the essence. Meeting our concerns will be the biggest challenge our game and industry has ever faced.”
In response to the challenge, FIFA will look to uses its enormous cash reserves to pump liquidity into the football industry, in a similar manner to which governments around the world are injecting money into their ailing economies.