The €100m question: how can an economic basket case like Spain afford Gareth Bale, the world’s dearest footballer?

As the Bale deal is sealed, Alasdair Fotheringham in Madrid reports on the Spanish reaction

Madrid

As former Tottenham star and new Real Madrid signing Gareth Bale stood in the centre of the Santiago Bernabeu stadium on Monday, some 20,000 fans cheered him to the rooftops and chanted his name. Further afield in economically crippled Spain, though, the news that one of their top two clubs had inked the most expensive soccer transfer deal in history – £85.3m – at a time when more than 25 per cent of Spaniards are living below the poverty line, met with a far more mixed reaction.

“Even amongst Real Madrid supporters, some find it hard to understand that such an expensive deal has been reached with things as they are,” Eduardo Rodríguez Alvarez, a football journalist with leading daily El País, said. “Beyond those supporters, it’s been greeted with much less comprehension altogether,” he added.

“The signing has been criticised both inside and outside the world of football. These are the kinds of sums are mind-boggling, although it is true that Real Madrid have always had a taste for signing big names.”

 “I find it shocking,” says Jacinto Vidarte, a long-standing Spanish football fan who lives near Madrid, “but that’s just the way this team operates.” The transfer figures for Bale, Barcelona trainer Gerardo Martino said categorically last week, “seem to me almost like a lack of respect to everybody. Beyond that, he’s a very good player.”

The question of how Real Madrid can afford to go on such an expensive shopping spree as Spain records its eighth straight quarter of recession is more complex.

Though Madrid has topped Deloitte’s Annual Review of Football Finance for four straight years with an annual revenue of €513 million for 2011-2012, an increase of 11 per cent on the previous year, there have been reports that the club is in debt to an even greater amount – nearly €600m. Real Madrid last year claimed their debt was much less than that figure.

Critics of the signing also point to the fact that one of Real Madrid’s best known lenders in recent years former was Bankia – the bank central to the toxic property debt at the heart of Spain’s banking problems and subsequent bailout. The irony when the Bale deal – and presumable loan behind it – comes at a time when Spanish banks’ willingness to provide credit to small and medium-sized businesses is according to the European Central Bank among the lowest of the entire EU, has been lost on few, too.

Furthermore, Real Madrid remain under investigation by the European Commission over allegations of illegal state aid dating from a 1996 agreement with Madrid city council. The club have denied the allegations. But at a time when 18 of the 20 Spain’s top tier La Liga football clubs are in financial difficulty, and when average crowd figures are reported to have shrunk to 70 per cent of stadium capacitiy, 20 per cent less than Germany and the UK, buying Gareth Bale arguably looks like a risky policy.

Those defending club president Florentino Pérez’s policy of signing big names for astronomic sums such as Kaká and Cristiano Ronaldo, who cost £140m in 2009, say that merchandising remains the key to the financial gamble. 

When David Beckham was in Madrid, over a million fans bought his number 7 replica shirt in the first year alone. And no one disputes that Perez has turned around Madrid’s finances since he became president for a second time four years ago.

As for the how of paying for the biggest deal in history, Real Madrid have a well-grounded reputation of preferring to pay for their transfers in instalments.

Local well-informed sources close to Madrid, who could not be named, say Bale’s deal is for six years, meaning that the payments could be for the same period. But the price still shocks.

“It’s taking us back to a time we should best forget of gross overspending in Spain,” Vidarte said.

“Beckham had a worldwide level of attraction before he came to Madrid,” Rodriguez Alvarez points out. “That isn’t the case with Bale, even though he’s more expensive.”

“Speaking personally, I think the whole of football is out of control here when it comes to spending. If the Tax Office and Social Security wanted here, they could finish it off.”

The next big layout for Spanish sport will be the Olympic Games, with a decision due this weekend, and Madrid with debts of around €7bn, the most indebted city in Spain. However, the Olympics is far less controversial given any future investment will, it is claimed, generate employment for at least 50,000 people. Real Madrid’s signing is for just one.

As for the man at the centre of the financial controversy, money seemed to be the last thing on his mind: “I wanted to come here, even if it was for a penny,” Bale said after his presentation.

PROMOTED VIDEO
News
ebooksAn unforgettable anthology of contemporary reportage
Voices
voicesBryony Beynon: This is something every woman can relate to
Arts and Entertainment
film

News
Mock the tweet: Ukip leader Nigel Farage and comedian Frankie Boyle
peopleIt was a polite exchange of words, as you can imagine
Arts and Entertainment
Steven, Ella Jade and Sarah in the boardroom
tv
Life and Style
fashion
Life and Style
Britons buy more than 30 million handsets each year, keeping them for an average of 18 months
tech
Arts and Entertainment
Benedict Cumberbatch is reported to be in final negotiations to play Doctor Strange for Marvel although the casting has not yet been confirmed
film
News
people
Arts and Entertainment
Alloysious Massaquoi, 'G' Hastings and Kayus Bankole of Young Fathers are the surprise winners of this year's Mercury Music Prize
musicThe surprise winners of the Mercury Prize – and a very brief acceptance speech
Arts and Entertainment
TV Presenters Ant McPartlin and Dec Donnelly. Winners of the 'Entertainment Programme' award for 'Ant and Dec's Saturday Night Takeaway'
musicAnt and Dec confirmed as hosts of next year's Brit Awards
Arts and Entertainment
Orson Welles made Citizen Kane at 25, and battled with Hollywood film studios thereafter
film
Life and Style
fashion

World Beard and Moustache Championships held last week

News
video
Arts and Entertainment
Copycat culture: the Chateau Zhang Laffitte in China, top, and the building which inspired it, in Paris, bottom
architectureReplicas of Western landmarks are springing up in unlikely places
Sport
Rolando Aarons watches as his effort finds the corner of the Manchester City goal to give Newcastle the lead
footballManchester City 0 Newcastle 2: Holders crash out on home turf
News
i100
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Primary Supply Teacher - Northants

£90 - £130 per day: Randstad Education Leicester: Primary School Supply Teache...

Maths Teacher

£21000 - £35000 per day: Randstad Education Chelmsford: Maths Teacher - Saffro...

Chemistry Teacher - Top School in Malaysia - January Start

£18000 - £20400 per annum + Accommodation, Flights, Medical Cover: Randstad Ed...

Geography Teacher

£21000 - £35000 per annum: Randstad Education Chelmsford: Geography Teacher - ...

Day In a Page

Isis in Syria: A general reveals the lack of communication with the US - and his country's awkward relationship with their allies-by-default

A Syrian general speaks

A senior officer of Bashar al-Assad’s regime talks to Robert Fisk about his army’s brutal struggle with Isis, in a dirty war whose challenges include widespread atrocities
‘A bit of a shock...’ Cambridge economist with Glasgow roots becomes Zambia’s acting President

‘A bit of a shock...’ Economist with Glasgow roots becomes Zambia’s acting President

Guy Scott's predecessor, Michael Sata, died in a London hospital this week after a lengthy illness
Fall of the Berlin Wall: History catches up with Erich Honecker - the East German leader who praised the Iron Curtain and claimed it prevented a Third World War

Fall of the Berlin Wall

History catches up with Erich Honecker - the East German leader who praised the Iron Curtain and claimed it prevented a Third World War
How to turn your mobile phone into easy money

Turn your mobile phone into easy money

There are 90 million unused mobiles in the UK, which would be worth £7bn if we cashed them in, says David Crookes
Independent writers remember their Saturday jobs:

Independent writers remember their Saturday jobs

"I have never regarded anything I have done in "the media" as a proper job"
Lyricist Richard Thomas shares his 11-step recipe for creating a hit West End musical

11-step recipe for creating a West End hit

Richard Thomas, the lyricist behind the Jerry Springer and Anna Nicole Smith operas, explains how Bob Dylan, 'Breaking Bad' and even Noam Chomsky inspired his songbook for the new musical 'Made in Dagenham'
Tonke Dragt's The Letter for the King has finally been translated into English ... 50 years on

Buried treasure: The Letter for the King

The coming-of-age tale about a boy and his mission to save a mythical kingdom has sold a million copies since it was written by an eccentric Dutchwoman in 1962. Yet until last year, no one had read it in English
Can instilling a sense of entrepreneurship in pupils have a positive effect on their learning?

The school that means business

Richard Garner heads to Lancashire, where developing the 'dragons' of the future is also helping one community academy to achieve its educational goals
10 best tablets

The world in your pocket: 10 best tablets

They’re thin, they’re light, you can use them for work on the move or keeping entertained
Lutz Pfannenstiel: The goalkeeper who gave up Bayern Munich for the Crazy Gang, Bradford and a whirlwind trawl across continents

Lutz Pfannenstiel interview

The goalkeeper who gave up Bayern Munich for the Crazy Gang, Bradford and a whirlwind trawl across continents
Pete Jenson: Popular Jürgen Klopp can reignite Borussia Dortmund’s season with visit to Bayern Munich

Pete Jenson's a Different League

Popular Klopp can reignite Dortmund’s season with visit to Bayern
John Cantlie video proves that Isis expects victory in Kobani

Cantlie video proves that Isis expects victory in Kobani

The use of the British hostage demonstrates once again the militants' skill and originality in conducting a propaganda war, says Patrick Cockburn
The killer instinct: The man who helps students spot potential murderers

The killer instinct

Phil Chalmers travels the US warning students how to spot possible future murderers, but can his contentious methods really stop the bloodshed?
Clothing the gap: A new exhibition celebrates women who stood apart from the fashion herd

Clothing the gap

A new exhibition celebrates women who stood apart from the fashion herd
Fall of the Berlin Wall: Goodbye to all that - the lost world beyond the Iron Curtain

The Fall of the Berlin Wall

Goodbye to all that - the lost world beyond the Iron Curtain