In recent years, the Blaugrana has experienced a massive decline.
FC Barcelona, one of the greatest football clubs of all time, is on the brink of financial catastrophe amid a crisis, which requires a thorough analysis.
It’s not surprising that FC Barcelona’s economic troubles have amplified to the point where they had to sell parts of their great club to activate financial “levers.” FC Barcelona used to develop the best footballing talent in the world, but now it’s like a transformer without wheels.
They used these levers to complete their transfers this summer and register them by La Liga regulations. The current scenario shows a trailer of the scary future that awaits this once-great club. Even so, they are desperate to let go of top talent to trim an already bloated squad.
As a club built on the tiki-taka style of football, FC Barcelona is now reportedly owing £1.1 billion! How did this happen?
FC Barcelona’s financial disaster analysis is laid out in a timeline of everything that led to the club’s current status:
2017-18 – Building a dream squad
A so-called “revolution” in Barcelona began in 2017. They splashed a lot of money on transfers and contracts for new players. In the same window that Neymar was sold to Paris Saint-Germain for £199.8 million, they signed Ousmane Dembele and Philippe Coutinho from Borussia Dortmund and Liverpool, respectively.
The Catalan giants spent $328.59 million on the duo mentioned above in 2017-18. They also signed Paulinho, Nelson Semedo, Yerry Mina, Gerard Deulofeu, and Marlon as part of their spree.
(£119.34 million) Their net spending for the season wasn’t massive in modern football. However, the vast contracts Barcelona handed out to some new players and stalwarts like Lionel Messi, Jordi Alba, Sergio Busquets, and others disastrously damaged their finances.
2018-19 – Beginning of an era of bad recruitment and mismanagement
In their first season at the club, Coutinho and Dembele struggled to find their feet despite being two of the main reasons for the club’s financial issues. Paulinho was bought from GZ Evergrande from China for £36m last season.
As a consequence of Yerry Mina and Lucas Digne’s departures to Everton for a combined £45.41 million, he was sent back on loan to them in the second half of the same season. He was then permanently sold to them for £37.80 million.
Gerard Deulofeu was transferred to Watford for £11.70 million. Barcelona also sold Marlon, Emerson Royal, and Aleix Vidal for a minimal fee. Andres Iniesta, a legend, signed with Vissel Kobe as a free agent.
During the 2018/19 season, the Catalan giants sold players worth £131.45 million. They brought Malcom, Clement Lenglet, Arthur, Arturo Vidal, Emerson Royal, Jeison Murillo (loan), and Jean-Clair Todibo for a combined £126.99 million.
2019-20 – The window that officially started Barcelona’s financial disaster
After winning La Liga back to back in 2017-18 and 2018-19, Barcelona announced another big transfer window for 2019-20. The Catalans spent £268.65 million on signing players that season, with a net of £131.04 million. They sold players such as Malcom, Cillesssen, Andre Gomes, Paco Alcacer, Denis Suarez, Marc Cardona, Sergi Palencia, and Marc Cucurella.
As part of the £137.61 million they earned from all departures that season, they also received a loan fee of £7.65 million from Bayern Munich for Philippe Coutinho. The Catalan giants signed Antoine Griezmann from Atletico Madrid for a humongous £108 million in 2019-20, a financial disaster in the transfer window. For a whopping £77.4 million, Josep Maria Bartomeu’s club swooped for Frenkie de Jong from Ajax.
2020-21 – Wage cuts, the strange transfer window, and the infamous “Barcagate” conspiracy
A year after losing the La Liga title to Real Madrid in 2019-20, Barcelona had yet to win a single league title in the two following seasons. The 2020-21 season was the beginning of Camp Nou’s downfall.
After reducing their players’ salaries last season, Barcelona first looked for alternative ways to reduce their wage bill. Their biggest deal was the exchange deal for Arthur Melo and Miralem Pjanic with Juventus. They offloaded Nelson Semedo, Rafinha, Ivan Rakitic, and Luis Suarez. Pjanic was acquired by Barcelona for £54m, while Arthur was sold to Juventus for £68.4m.
To explain the inside details of this deal in greater detail, a separate article would be required. This deal was solely due to hiding both clubs’ financial problems for one more year. In the 2020-21 season, most of Barcelona’s players refused to take a pay cut. However, Frenkie de Jong, Clement Lenglet, Marc-Andre ter Stegen, and Gerard Pique agreed to be paid less.
In response to this incident, Josep Maria Bartomeu resigned after realizing that other players would not agree to similar wage-reduction deals because of the club’s bloated wage budget.
Post Bartomeu era:
There were reports by October 2020 that Barcelona faced the ultimate financial crisis, bankruptcy, and that only divine intervention could save them. Imagine the scenario after massive wage cuts.
A few months later, in March 2021, Bartomeu was arrested by the police on charges that he paid a PR company to harm the reputation of some big Barcelona players on social media. While that was happening, Joan Laporta was elected president of Barcelona in March 2021 by beating Victor Font in the election.
In April 2021, Laporta was one of the three club presidents/owners who devised the famous European Super League plan just a month into his new role. To save themselves from financial instability, 12 top European clubs announced they would form a new competition. The result was a total media nightmare for all three clubs, forever tarnishing their reputation in world football.
The identity crisis
Although there was a lot of movement during the summer transfer window, there was no way to beat the way Lionel Messi, the club’s greatest asset, was discarded last year. It was a teary exit for Messi after over 15 years of service for the club. His contract had expired, and the club could not afford to renew it. While the Argentine was leaving a franchise that was now very different from the one he joined, it was a bittersweet exit.
There have been many shifts in the club’s identity over the years. Under Pep Guardiola, possession of the football was the hallmark of the Golden Generation between 2008 and 2012, and Luis Enrique’s treble-winning 2015 team benefited from it as well. In a single transfer window, the club signed Kounde, Lewandowski, Raphinha, and Kessie, proving it doesn’t want to build on players that have come through the system anymore.
Youth Policy Damaged:
Barcelona has always succeeded when products from its famed La Masia youth academy form the team’s core. The club hierarchy continues to use the revolutionary ideologies of Johan Cruyff to groom its youth squads. Still, fans have criticized the club hierarchy for signing big players instead of promoting and developing young players.
The team had talented young players. Pedri, Gavi, Ansu Fati, Alejandro Balde, Sergino Dest, and Riqui Puig showed great potential. The other youngsters remaining will now be overshadowed by the newcomers since Dest and Puig left for AC Milan, and Barcelona reserved the right to repurchase 50% of any future sale.
Aside from Ferran Jutglà, who left the club for Club Brugge this summer, and loanees Alex Collado and Ez Abde, Barcelona even let go of highly-rated 19-year-old Guinean striker Ilaix Moriba in January.
The XAVI ERA:
While the hope was that Xavi’s arrival would have a similar effect to Guardiola’s arrival in 2008, the immediate financial crisis prevented Xavi from building a long-term dynasty with the La Masia Youth, as he was supposed to solve the identity crisis last season.
During the transfer deadline day, Barcelona wanted to offload several players that were being criticized for being influenced more by business decisions than squad requirements.
Six months ago, Barcelona purchased Pierre-Emerick Aubameyang, and he reluctantly left for Chelsea. Memphis Depay needed help finding a buyer under Ronald Koeman. Martin Brathwaite turned out to be a failed signing, and Barca decided to release him as a free agent. AC Milan loaned 21-year-old Dest.
Ultimately, Aubameyang, Brathwaite, and Memphis proved to be short-term investments, with Lewandowski and Raphinha considering upgrades.
Barcelona has been grappling with one of its best players, Frannie de Jong, all summer, as the club wants to cut his high wages to pay new recruits. While de Jong refused to do so, Barcelona started searching for a buyer. The Dutchman eventually stayed after much discussion. They still owe him €17 million in deferred wages by the club.
2022-Present – A dream transfer window that screams “soul-selling.”
Amid their financial crisis, Barcelona has managed to rattle fans around the world. They can’t wrap their heads around how a club owing €1.35 billion can sign all the players mentioned above.
Long story short, they can’t!
La Liga’s financial fair play rules state the amount a club can spend on transfers. This amount includes transfer fees, amortization, and wages. A club must meet these rules to be able to sign or play.
The Clubs register new players through an app available to them by the league. This app will automatically allow a club to sign a player beyond the financial controls set by the league. FC Barcelona’s economic disaster, a -£144 million figure, means they must break even first.
In January, they can spend money on new players once they have done that. FC Barcelona needs to cut costs and make money rapidly in the following summer transfer window. It is all a hell hole in the loop, an impending financial disaster.