Europe, South America, Africa and the US are all experiencing difficulty off the field. Meanwhile, Asia and Australia are capitalising on their relative economic booms.
Economist Sav Savouri recently spoke about the financial situation of Greece, US, China and Australia.
Savouri is of the opinion that the Australia dollar will hit $1.70 against the US.
Furthermore, he told Australians to fear not, as our Asian neighbours will also experience similar, if not greater, growth in their currencies.
The general economic view is that Europe and the US will need to increase taxation and reduce spending to bring their budgets under control.
Now, stay with me as the connection to sport is coming in a moment, but as Asian currencies rise, growth takes place, thus improving the purchasing power of Asian currencies. Meanwhile, expected asset values in Europe and the US are falling.
Expected tax rates in England are already making many re-think the English Premier League.
When other European nations are forced to lift their tax rates, a question begs in the open, free market of football: where will the best go?
How will this affect football, union and league in Australia?
I have always held the view that Europe is over represented at the World Cup. When will Asia get more World Cup spots?
With money comes power. Asian will have money, so why, for example, should Demark and Norway be preferred to Indonesia and Malaysia?
For Australia and the A-League the financial boom provides future advantages we have never had before.
It’s worth remembering in the first A-League year the dollar hovered mainly between $0.70 and $0.80 cents to the US.
Australian tax rates have since fallen, whereas tax rates in Europe and the US are about to increase.
Thus, an Australian $100,000 contract with Australian tax rates has much more to offer than a few years ago.
Additionally Australia offers players a safe place and generally high employment, meaning that family and friends of a potential overseas player are well catered for.
As the Asian century grows and the influence of Asia grows, who will be the powerhouse nations in one hundred years?
I find it hard to believe the status quo will remain.
European powerhouses countries like Spain and Italy will struggle.
Real Madrid has been propped up for years by the Spanish government, as have of the top European clubs.
The big investors in the EPL and Europe are coming from the Middle East and Russia.
Asian has two thirds of the world’s population, with China, Indonesia, Malaysia, Vietnam having close to 1.8 billion people. They are all football-mad nations.
You can add India to that list, where football is not as far behind cricket as many seem to think.
My guess is that Asia will become the new powerhouse of football, but it will be a gradual process.
Australian tax rates and the future international purchasing power of the Australian dollar will have many willing to play in the A-League who would have never considered it before.
Moreover, Australian rugby will improve its ability to keep its best players from going to Europe. Maybe rugby league will be able to raid European rugby as well.
If we expanded this thinking to rugby the purchasing power of the Australian dollar and Australian tax rates will make raids from Europe on players less likely.
Arguably Australian rugby will be in a strong position to buy players from Europe.
Rugby league could also look to raid European rugby if the dollar raises to this degree and it can pull off its $1.2 billion media deal.
With money and economic growth coupled with massive populations power and influence will follow.
For sport in general this will be good for Australia.
For football, in particular, it could be very good indeed.
Raghu
Guest
If the Aud reaches 1.70, then God help us all. The only sector that is doing well at the moment is Resources sector. With that kind of ex rate, revenue would be halved and it would be unsustainable to keep on operating small mines. Lot of people will be out of work and won't be able to watch A-league games.
Brendon
Guest
I think it should be noted for rugby union in particular that quality trumps quantity. Look at the all blacks... 4 million ppl. Compare to England
werty55
Guest
China is not football mad.
Midfielder
Guest
Cameron You could be right about where the AUD will finish up, but most are predicting a devaluation of the US dollar and Euro .... we are at a kinda crossroads in world economic terms.. Further the US is talking up tax rates and so is Europe... The US has a budget deficit of 8.5 % of their GDP, many European have more and they are both in debt up to their eyeballs China & India are starting to grow at quite a quick rate... if you add Korea, Honk Kong [OK part of Chine], Vietnam, Singapore & Thailand .. never forgetting Japan [although they also have some issue] ... also both Indonesia & Malaysia are showing signs of real future potential ... My simple hopefully logical argument using the A-League & AFL as examples.... an A-League contract in Hal One of $ 100, 000 was worth in US dollars US & 70, 000.... using AUD $ at 1.50 that same contract is worth US $ 150, 000.... The recent AFL media deal [the cash part] was worth as I understand it 1.12 billion using the same figures ... at US $ 0.70 its worth 770 million but at at US $ 1.50 its worth US $ 1. 650 billion.... Add to the above changing tax rates and general lifestyles Australia will IMO be able to attract better players in the international sports ... Football [in particular], Union & League.
Cameron
Guest
The claims made in this article about Australian growth of the game are based around the dollar being as high as $1.70. I doubt there are any other economists other that the one quoted that believe this
Midfielder
Guest
Fut I don't estimate European football ... nor to I under rate Asian football... with management over time the sheer numbers in Asia will have an affect... money and economic power drives much of world sport and the money , people and power will be in Asia... I am simply saying the increasing value of the Asian currencies and given future expected tax rates ... Asian will over the next 100 years take over as the sports power house ... More particularly I said the increased purchasing power of the Australian dollar and our tax rates mean an A-League contract starts to become more competitive than it was before.. Union and league have also been raided in recent years by European clubs ... this trend will also start to work the other way around...
Futbanous
Guest
THe reason that European teams are favoured is simply that Europe has earned its football credibility stripes,Asia is still a novice. The WC results tell us this is an historical fact. This is not to say that there is no truth in this article about the future,I believe the future of Asia is strong & therefore Australia. However to underestimate the power of European football is folly. Anybody brought up on the game in any European country can tell you that the Football culture Johnny Warren craved is still a way off yet here. Also this article underestimates the power that US football will have on the World game in the future. Football is not just about money its about passion for the game . Money can't buy me love to quote the Beatles. You can't steal passion with money it has to develop of its own accord. The ACL judging by crowds across the continent is still light years away from the ECL. This article should have concentrated on a developing football passion in Asia into the future as much as it has about a money swinging away from Europe. In that respect I would agree football passion is spreading but its not affecting Europe one iota. So I don't see a future where Asia takes over from Europe,but one where the passion for football is on a more even keel across the globe. In that sense we as a first world country are in a good position as most countries don't have the economic resources to spare for professional football. The passion may spread, but the countries that can provide employment for professional footballers will still be limited,particularly in our region. There may be 46 members of the AFC but most even with economic boom times will never have viable professional leagues.
Stevo
Guest
The Asians are football mad and will have the economic clout no doubt. But corruption has been a factor. Simon Colosimo's article makes interesting reading about issues hampering the rise of the game in the region. http://sportbizinsider.com.au/opinion/analysis-pfas-simon-colosimo-on-the-big-issues-hurting-asian-football/ If administrators get their act together then the region will be a power-house and Australia will be set to benefit.