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AC Milan's finances continue to cause concern

As they prepare to face Arsenal on Thursday, AC Milan's finances continue to cause concern. Uefa are far from happy with the financial stability of the Chinese consortium that acquired the club from former Italian prime minister Silvio Berlusconi: Murky finances

Perhaps even more significant, alarm bells are ringing in China. The Chinese authorities do not want their country to suffer any reputational damage from profligate spending overseas.

The South China Morning Post has commented: 'AC Milan are owned by Li Yonghong, whose Rossoneri Sports Holdings took over in April last year in a convoluted deal worth US$860 million. Li has been reported to be bankrupt – which he dismissed as "fake news" in his Chinese New Year message to Milan fans – and Italian newspaper Corriere della Sere has said that the club risks being sold on Chinese e-commerce site Taobao.

That is unlikely to happen even if Li’s finances are as dire as feared. Instead the club will likely go under the control of the US hedge fund Li borrowed from to get the deal over the line. Nevertheless, something is clearly rotten and Li with his fake news and dodgy bank balance is not far away from wearing a "Make Milan Great Again" baseball cap.'

The whole Chinese economy is structured around debt in a way that would not be acceptable in the west. This is not a problem as long as tycoons follow the party line. Party control is being tightened under President Xi Jinping who places a greater emphasis on ideology than his predecessors. He has consolidated his hold on power and looks to be the longest serving Chinese leader since Mao. Frivolous investments in overseas football clubs that attract bad publicity are frowned upon.

A further complication is the political crisis in Italy itself where there are no feasible permutations for a coalition government. Silvio Berlusconi did not revive his political fortunes in the way that he hoped and an unstable minority government might well be the outcome.

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