Since the beginning of the invasion of Ukraine by the Russian army on February 24, Russia has been barred from international sport: exclusion of Russian athletes from the Beijing Paralympic Games (until March 13) decided by the International Paralympic Committee, as well as from football competitions – including play-offs for the 2022 FIFA World Cup in Qatar – by FIFA and UEFA, skiing, biathlon or handball, etc. ; cancellation of all international events planned on Russian soil; or even the obligation for Russian athletes who are still allowed to participate in competitions (tennis, swimming, etc.) to do so under a neutral banner.
the economist Wladimir Andreffhonorary professor at the University of Paris-I Panthéon-Sorbonne and chairman of the scientific council of the Observatory of Sports Economics, describes the impact that these various sanctions are likely to have on the sports economy, in Russia and the West.
What could be the economic consequences of the sanctions against Russia in sport?
They will be heavy and we could see a massive flight of Russian athletes to the West. If the conflict continues, the fall of the ruble and hyperinflation will melt the value of clubs in Russia. The oligarchs will not put any more money into the sport under these circumstances, as it would invest at a loss.
Above all, Vladimir Putin will face a problem he probably did not foresee: the cost of rebuilding a devastated country bigger than France.
Sports financing will no longer be a priority in Russia, especially as Russian athletes no longer have the prospect of winning medals at the Olympics. Some international sports federations are pro-Russian, I’m especially thinking of ice sports, but some Russian federations are not hostile to the West, even if they can’t express it. This can lead to a mess that will discourage investment. I am sure that Russian sport will get poorer.
Which sports are most affected?
In Russia, supporting the Olympic disciplines is an age-old tradition. It dates back to the times of the Soviet Union and the Cold War. Under Putin, sports such as judo, basketball, fencing, ice hockey, cross-country skiing or biathlon have always benefited from Kremlin support, mostly through investments by oligarchs close to the regime. Since there is no prospect of a medal, there is a good chance that this windfall will dry up.
Very popular in Russia, the Kontinental Hockey League [la Ligue continentale de hockey sur glace, deuxième championnat le plus important au monde après la NHL nord-américaine]which can be seen as the hockey equivalent of the Champions League in football, will disappear in its current form, perhaps to be reborn as an all-Russian league, but this competition will be less interesting for spectators and sponsors.
Taking football as an example, would a Russian championship operating in autarky be economically viable?
It is technically possible, but the importance of such a competition would be all the weaker because most of the “legionaries”, the nickname given in Russia to players from abroad, will leave the country. FK Krasnodar has already announced the suspension of the contracts of eight of its nine foreign players. Public interest will diminish.
Sponsor contracts are being scaled back. It is not so much the exit of foreign companies from the Russian championship that will be a problem, as they are not very present there, but the general financial slump will encourage Russian groups, especially banks, to stop sponsoring clubs.
The big clubs that used to play in the Champions League, such as Zénith Saint Petersburg or CSKA Moscow, lose at least 10% of their turnover because they can no longer participate in this competition. For Dynamo Kiev, the situation is much more dramatic. It is not certain that the historic Ukrainian club [fondé dans les années 1920] survive the war.
Will the sanctions also affect the sports economy outside Russia?
For two decades, world sport has benefited immensely from Russian money, in particular through sponsorship deals and the organization of major sporting events such as the Sochi Olympics in 2014 or the 2018 FIFA World Cup. Russia’s exile is over.
UEFA and Schalke 04, who have already announced the termination of their contracts with Gazprom, will easily find another sponsor. It is mainly the image of the gas giant that will suffer, as well as its economic value. The sports economy in Europe will be much less affected by the withdrawal of sponsors than in Russia.
In addition, the assets held in Western football clubs by Russian oligarchs such as Dmitri Rybolovlev at AS Monaco or Roman Abramovich at Chelsea are at risk of being blocked for a long time. Their confiscation is not impossible, even if it promises to be legally complicated.
It is for this reason that Roman Abramovtich announced the sale of the London club, which is probably heartbreaking for him, by promising to create a charitable fund intended for “all war victims”be it Ukrainian or Russian.
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