Mr. President, football is a global mega business
Nigeria is the current African champions, but the state of the game at home leaves a lot to desire and at odds with the ranking. The performance of the national team in the recent Confederations Cup revealed the sad fact that we are no longer an elite global football nation. The Nigeria Police Machine team and three other teams in the lower leagues were recently involved in an excessive match-fixing scandal with final results 67-0 and 79-0. The irony is that the half-time score was only 7-0. FIFA swiftly intervened with life bans to save the game’s reputation. It is only in Nigeria that teams don’t want TV coverage with all the associated revenues, because with a televised match you cannot influence the outcome of the match. “We would have loved to see the highlights of the 146 goals thriller.” Amos Adamu, a former director of the Ministry of Sports, was compromised on video by a British newspaper. The revelation led to his removal from the global FIFA Executive Committee. While we as Nigerians tend to have heavy-duty shock absorbers for this kind of conduct, collectively we are the laughing stock of the world and are no longer taken seriously. Consequently, Africans from smaller countries are taking our place in the global arena of influence.
Our local Nigerian Premier League (NPL) is an inferior brand and product. Undervalued TV rights coverage and sponsorship deals are less than $10 million, compared to South Africa which is in excess of $500 million. It is ironic that the same Nigerian companies and their sponsors in an attempt to out-bid themselves are now paying a hefty premium for the English Premier League TV rights, far beyond the rights owners’ expectation for the African markets. The only interest Nigerians now have in local football is in the ailing national team.
This has not always been the case. A vibrant and dynamic local league in the 90s led to the emergence on Nigeria as a global football powerhouse. Players that emerged from this league within the period led us to our second African Nations Cup victory, three successive World Cup appearances and an Olympic Gold medal. This was without doubt the most successful period in Nigerian football, now in steep decline and going into freefall. Teams with deep pockets and strong corporate backing such as Julius Berger, Stationery Stores, Leventis United and Abiola FC have all failed to sustain their presence in the league. All the teams in the NPL are currently owned by state governments and funded by taxpayers with no incentive to return profit. Without this incentive, the business potential of Nigerian football cannot be realised with the national team and NPL. IMG, the global sports management powerhouse, has valued the undeveloped Indian Football League, a country that has never been to the World Cup, and cricket-focused market at $300 million, which easily puts the NPL valuation at $1 billion. IMG or any similar global company, if given the entire Nigerian football structure to manage, will realise value in excess of this valuation.
What this means is that both the federal and state governments will no longer have to spend all taxpayers’ money on football and all the national teams. The money saved can either be reinvested in social infrastructure or used to develop other sports at the grassroots, engaging restive youths and improving our all-round Olympic performance. This idea is also in alignment with Mr. President’s Transformation Agenda. It calls for private sector-led growth in recognition that government spends 75 percent of its revenue on recurrent expenditure and only 25 percent on capital expenditure. Our dynamic coordinating minister for the economy will also be pleased with this arrangement. She can reallocate the football ministry budget to the creation of a proper sports ministry focused on grassroots sports development. She will also be taking 25 percent of the billion-dollar turnover as taxes. Mr. President, sir, as you are transforming and privatising the power and other sectors, please don’t forget the football sector. It’s something that can be done in less than a year, quick-win and a low-hanging fruit. The inefficiencies that strangled the telecom, banking, aviation and power sectors under public-sector management are also prevalent in Nigerian football organisation and management. This is clearer to us all with the privatisation of these key sectors. Government has no business running businesses but should provide a strong legal and regulatory framework to operate within. Government also collects 25-30 percent corporate tax in every registered company, so it’s a win-win.
The current confusion in the Nigerian football administrative structure reflects the magnitude of the problem. There is the Nigerian Football Federation (NFF), an illegal entity set up to hoodwink FIFA, and the Nigerian Football Association (NFA), the original and legal entity that was registered by private-sector clubs with FIFA in 1959. During the Babangida military years, he came up with Decree 101 which effectively took away football from the private sector at a critical time in the development of our football. It is now the NFA Act with no change and same draconian statutes that put control of football firmly in the hands of government and the minister of sports. All efforts to repeal this Act have failed. The last attempt was in August 2011 when the then sports minister set up a nine-man reform committee to repeal the Act. To date, there has been no progress on the issue.
What is the way forward? We can start with the example set by Governor Fashola in Lagos. There are no NPL teams in Lagos despite the market size. In comparison, another state with one-sixth of Lagos population has two NPL teams both funded by the state government. Governor Fashola gets it. He is of the opinion that the role of the state is to provide facilities and an enabling environment. He has built such excellent facilities in Lagos and there are more across the country. He has gone a step further by refusing to commit state funds to any football club and given an assurance to provide security and maintain law and order at all his venues to ensure football becomes a family event and attracts a large turnout. He has now challenged the private-sector teams in Lagos to emerge with sponsors and TV rights.
With the right business approach, we can unlock the value in our football industry just as we have done in banking and telecom. Globally, the industry is a multi-billion industry. Clubs are listed on exchanges, players are traded in multi-million dollar deals, and top players earn a staggering N100 million weekly. Revenue models for TV rights, merchandising, sponsorships and ticketing are tried and tested.
Mr. President, sir, on the 44th memorial of Israel Adebajo, as a democratically elected president in what has been described as the freest and fairest election to date in Nigeria, I will like to directly appeal to your good offices, in the democratic spirit, to kindly consider the return of the FA taken away by a military decree in 1992 to the original private-sector owners. The transformation of football is in line with your agenda and you can replicate the privatisation in the power sector in the football sector. Serious business-minded club owners do not need federal or state money or budget to survive. Club owners have the capacity to manage business and do not need a minister or ministry to run their affairs. Companies like IMG can assist to unlock value, creating more jobs, engaging restive youths and increasing the government tax base in the process. The ownership and sovereignty of the national team are not in doubt, even if it’s managed and funded by a private sector FA.
Adebajo is an investment banker, economist and policy exponent
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