SG News (Straits Times)

Fifa plans huge relief fund to support ailing football industry

By June 29, 2020 No Comments

GENEVA • Faced with mounting concerns and daily updates about the crisis wrought by the coronavirus pandemic on global football, Fifa is drawing up plans for an emergency relief fund worth hundreds of millions of dollars, according to people with knowledge of the matter.

The fund would amount to the biggest response from any major sports governing body to the financial ramifications of Covid-19.

As in other parts of the world economy, movement restrictions to reduce the spread of the disease have halted the cash flow in a business in which long-term financial planning is typically treated as a luxury, with gate receipts, broadcast and sponsorship income largely committed to player salaries and transfer market trading.

That has led several Fifa federations and their respective clubs and leagues to declare themselves to be in a state of financial distress.

Earlier this week, MSK Zilina, seven-time Slovakian champions, were placed into liquidation, while Uruguay’s federation laid off 400 staff members because all football activities had been suspended.

Even the biggest teams have not been immune to the first shutdown of its kind since World War II, with the likes of Barcelona and Juventus announcing pay reductions for their multi-millionaire playing roster, and others have followed suit.

According to its latest annual report published last year, Fifa had cash reserves of US$2.74 billion (S$3.93 billion).

Football’s world governing body is considering putting some of those reserves to use in the effort to prop up the ailing sport.

It is also willing to borrow against its future television and sponsorship income to raise money for what is being described internally as a “football relief fund”.

The fund would require the Fifa Council, a 36-member group made up of officials from the sport’s six regional confederations, to sign off on it before the plans can move forward.

The relief fund, according to the plan, would be managed independently from Fifa’s leadership to avoid the risk of being contaminated by political issues that have long roiled the sport.

NYTIMES

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