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In November 2020, Jiangsu Football Club clutched the China Super League trophy for the first time, having beaten eight-time champion Guangzhou Evergrande. Today, with a new season about to start, it is out of business: Pressure on embattled retailer Suning Appliance Group Co. forced the conglomerate to reconsider its investment in the team. China’s soccer bubble is rapidly deflating.

Encouraged by President Xi Jinping’s love of the game, his stated desire to build a sporting superpower and soccer master plans, companies and wealthy backers poured cash into China’s clubs, training and more. Stunts like Xi’s 2015 visit to English club Manchester City — including a selfie with star striker Sergio Aguero — prompted them to gloss over the rickety financials of a business that even in established European leagues tends to burn more cash than it generates. The political benefits, at least, were clear.

Businessmen went overseas with gusto, snapping up clubs from 2014 until official warnings over “irrational” behavior began to trickle down a few years later. Suning bought a majority stake in storied Italian side Inter Milan in 2016. (The club says Suning remains committed, but will seek strategic financial partners.) Meanwhile, Europe’s biggest names wooed China’s 1.4 billion potential fans.

The tale of Suning and Jiangsu FC, known as Jiangsu Suning until rules restricted corporate naming, captures all the exuberance, frustration and, ultimately, disappointment of the past few years. Part of the first fully professional top-tier league in the country in the mid-1990s, the Nanjing-based club faltered until Suning made it one of the wealthiest teams in China. It splurged on Brazilian players like Alex Teixeira, whose winning goal saw the side triumph in 2020.

Unfortunately, it turns out that Suning was better at lavishly accumulating assets than turning a profit on its sports investments. There was Jiangsu and Inter Milan, but the group also snapped up broadcast rights and tried to buy Stellar Group, a leading soccer agency. That house of cards has now mostly collapsed. Debt and delayed salaries hobbled the Chinese club, and Teixeira’s contract expired. The English Premier League canceled its television deal last year, over missed payments.

Much of Chinese football spending abroad, and Suning was no exception, was an exercise in pricey corporate hubris that was never likely to end well: Close to $3 billion was spent buying European soccer teams between 2015 and 2017. It’s less clear why there’s been next to no progress back home with the more humble job of turning the top-tier Super League into a credible competition, despite plentiful cash, official attention and millions of eager fans.

It’s true that overhauling this domestic league was always going to be a struggle, and not just because of match-fixing and other corruption scandals that tarnished the game in the 2000s. Certainly, there’s mismanagement and cronyism — hardly unique to China. There are also deeper structural issues that have hampered the creation of a sport sustainable in financial terms, and with roots in its community. There is no evidence yet of the promised “100 year clubs.”

In part, that’s because thin revenue streams leave teams at the mercy of fickle backers. Constant rule-changing by the governing body — tackling salaries or foreign players, say — doesn’t help either, however well-intentioned, and fails to deal with the bigger picture. As Mark Dreyer of website China Sports Insider explains, it has been tough for these clubs to commercialize the sport in the way international rivals have. Unsurprising, then, that few have sought to follow Manchester City owner City Football Group and invest in a local name. Even with its Chinese shareholders, it has started small with lower-league side Sichuan Jiuniu, lacing up for a long game.

It’s graver, though, that China has yet to create a soccer culture. The game is popular, but not played enough. A 2017 study from Germany’s WHU Otto Beisheim School of Management found Chinese football fans watched the sport almost three hours a week, but only 7% played the game themselves. More importantly, few kids are allowed to sacrifice significant study time to try their luck on the field. Wild East Football site founding editor Cameron Wilson, who published an exasperated cri de coeur last month on the state of the game, told me that without that bottom-up enthusiasm, business investment and support can only make limited improvements.

Today, China is very far from Xi’s goal of winning the FIFA World Cup. China’s men’s team ranks 75 according to FIFA, just above war-torn Syria. Perhaps the alternative is to focus on women: They rank 15th.

Western clubs will continue to circle China. The pool of fans is deep, and will become more lucrative as digital streaming and e-sports — competitive video gaming — add to revenues that in the past have been curbed by rampant piracy.

China’s own efforts look more tired, even if Jiangsu FC is eventually rescued. Beijing-based conglomerate Dalian Wanda Group Co. boss Wang Jianlin, who bought a stake in Atletico Madrid in 2015, complained a year later that the club was burning cash. It may give you influence, he warned others, but it won’t make any money. Wise words. He sold in 2018.

Clara Ferreira Marques is a Bloomberg Opinion columnist covering commodities and environmental, social and governance issues.

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