ByJIANGXIAOJUANC
hina’s sports industry is
currently seeing a period
of rapid development,but
the challenges itfaces are
still many, and efforts are needed
to maintain a healthy and orderly
environmentforthe sustainable
developmentofthe industry.
In 2014,China releasedthe No.
46 Documentto promotethe devel-
opmentofthe sports industry.
Inthe following five years,the
added value ofthe sports industry
grew significantly fasterthanGDP
growth.Atthe sametime, impor-
tantchanges havetaken place in
spor tsconsumption.
Lastyear, duringAlibaba’s Nov 11
shopping festival, known as Singles
Day, sports goods accounted for 3
percentoftotal sales.The figure
represented an average level of
sports goods consumption in a
country with a medium-developed
sports industry.
There were certain noticeable
featurestothe consumption pat-
tern.
Alarge number of ordinary con-
sumers have beguntopayattention
to professional sports equipment.
There is also growing interestin
mid-to high-end sportevents, and
high-end sports like skiing, rock-climbing and equestrianism are
continuing togrow in popularity.
NowtheChinese sports indus-
try, interms ofthe income level of
consumers, degree of government
attention and level of participation,
is developing ata very high speed.
The internetand artificial intel-
ligence have greatly improvedthe
efficiency of sports services.Typi-
cally, sports have been a human-to-
human on-site consumption for a
longtime.And as a classic service
industry, its efficiency had been
very low.
Withthe internetand live TV, one
game can now be seen by millions of
spectators, and hundreds of millions
of people can watchthe replays and
seethe highlights.Atpresent,the
numberof spectators andthe size
ofthe markethave been expanded
significantly.Therefore,the internet
has greatly improvedthe efficiency
ofthe sports industry.
The internetage has also made
sports a global industry.Lastyear,
an exhibitiontitledGlobalization
inthe Past 100 Yearswas held at
the National Museum inBeijing,
showcasing 100 cultural relics
highlightingthe developmentof
globalization.
The lastexhibitfeat ureda foot-
ball jersey belongingto soccer star
DidierDrogba fromCoted’Ivoire,playing fortheEnglish Premier
League sideChelsea.Chelsea’s boss
is a Russian, and its sponsor Sam-
sung is from South Korea.This jer-
sey was produced in Indonesia and
sold inBrazil and Peru.Itshowed
how sports have become globalized
inthe pastcentury.
China’s sports industry has
unique advantages.
First,China’s large population
benefitsthe developmentof its
sports industry.With a population
of 1.4 billion, many popular sports
can be accepted and developed.If
only1 percentofthe public pays
attentiontoaparticular sport,it
means an audience of morethan
10 million people, which is almost
unimaginable in many countries.
Also,there are many big cities in
China,the number of which is larg-
erthanthatofthe whole ofEurope.
There are 14 cities inChina witha
population of morethan 10 million,
morethan 100 cities with a popula-
tion of morethan 5 million, and
morethan 200 cities with a popula-
tion of morethan 2 million.Acity
with 2 million people and an output
value of $20 billion is big enough
to supportone ofthe world’stop
professionalsports clubs.So, we can
imaginethe potential ofChinese cit-
ies in sports development.
Large cities are beneficial forsports development, especially for
the professional sports industry, as
a high level of urbanization means
higher prices can be charged for
ticketsto sporting events.
Inthe United States,the National
BasketballAssociation has different
ticketprices in differentcities.Tick-
ets are sold for much more inthe
three largestcities — New York, Los
Angeles andChicago.
Second,the support ofthegov-
ernmentis beneficial forthe devel-
opmentofChina’s sports industry.
China’s central and local govern-
ments have made plans, interms
of per capitafitness area, fitness
time and committed investment,to
makethe country’s sports industry
reach a higher level.
In addition,China’s local govern-
ments have been creative in encour-
aging sportseventstobeheldin
old business areas, which can raise
people’s interestin sports andtrig-
ger growthinthe local economy at
the sametime.
In general,the central and local
governments are very motivated,
whichcreates favorable conditions
forthe developmentofthe sports
industry.
Of course, developmentofthe
industry is facing challenges, main-
ly duetothe stagnatedtotal volume
of entertainmentand competitionfrom other options.New forms of
entertainmentthatcan replace
sports pop up allthetime.And
there is a limittothetime people
will spend ontraditional sports.
So, we haveto ensurethatour
sportsare made as interesting as
other forms of entertainmentin
ordertocatch people’s attention.
In fact, many shows and perfor-
mances are now very similarto
sportsevents, asthey all provide
the audience with a comprehensive
experience.So, itis importantfor
sportseventstokeepinnovatingto
attractyoung people.
To some e xtent,the rapid devel-
opmentofChina’s sports industry
is coexisting with disorder — so
strengt henedregulation ofthe
industry is needed.Withbotha
functioning marketandthe over-
sightofthe government,the sports
industry will be ableto develop in a
healthy and orderly manner.The authoristhe dean ofthe School
of Public Policy& Managementat
TsinghuaUniversity.Thisarticle is
compiled from herspeech atthe 2019
TsinghuaPBCSF Global Finance
Forum.The authorcontributedthis
articletoChinaWatch, athinktank
powered byChinaDaily.Theviews
do notnecessarilyreflectthoseof
ChinaDaily.China’ssportsindustrygrowsrapidlybutinnovation,betterregulationkeytohelpingitprosper
Setting sportinggoals
BySUNYUNCHUANF
acebook has released a
white paper on its Libra
cryptocurrency project,
saying its goal isto issue a
“stable currency builton a secure
and stable open-source blockchain,
backed by a reserve of real assets,
and governed by an independent
association”.Itsparked heated dis-
cussions worldwide, especially in
political and financial circles.
US governmentorgans, including
the House of Representatives, and
G7financeministers and central
bankers have strongly opposedthe
program, fearing Libra could pose
a challengeto sovereign curren-
cies,the US dollar included.Some
experts and scholars, however,
argued Libra could createnew
opportunities forthetraditional
financial industry.
Irrespective of whether or not
Libra is issued nextyear asFace-
booksaid,the release ofthe whitepaper is an audacious attemptto
introduce a cryptocurrency with
the aim of breakingthetraditional
financial and currency systems.
Once launched, Libra,thanksto
Facebook’s morethan 2 billion user
base and strong industry consor-
tium, could greatly reducethetime
and costof cross-border banking
transactions, including internation-
al payments and settlements, and
foreign currency exchanges — and
setthe restructuring ofthe global
financial system in motion.Itcould
also signalthe end of other crypto-
currencies including bitcoin.
The introduction of Libra could
also leadtothe misuse ofthe users’
transaction data andtherefore
infringetheir rightto privacy and
compromisetheir safety.Itcould
increase crimes such as money
laundering,tax evasion and drug
trafficking, and even imperilthe
securityofthe global financial sys-
tem.And if Libra wereto lose its
credits, itcould create a financialtsunamithatwould devastatethe
market.
If people use real assets perva-
sively and directly link Libra for
exchanges, Libra will become a
greatthreatto sovereign currencies.
And if notstopped from achiev-
ing its goals,C alibra,aFacebook
subsidiary designedto issue Libra,
could become a de facto currency
issuing body, making itvery dif-
ficultfor countriesto implement
currency policies and rendering
the USFederal Reserve and other
countries’ central banks almost
redundant. Eventhe dollar could
seethe end of its global dominance,
which is whatthe US is really wor-
ried about.
Yetdespitethe US authorities’
strong vocal opposition,they could
end up secretly supporting Libra
because itis “Made inAmerica”.
The alleged strictUS regulation
againstsuch virtual currencies may,
in essence, be an effortto reduce
relevantparties’ concerns inthe US.D uringtheUS Senate hearing
on July 17,David Marcus, head of
Facebook’s cryptocurrency project,
stressedthatLibra, as a means
of payment, will competewith
WeChatandAlipay, which have
become dominantplayers inChi-
na’s mobile paymentsector.Indeed,
itis possiblethatLibra, by virtue of
Facebook’s massive social network
andthe advantages international
paymentgiants such as Visa, Mas-
terCard and Paypal enjoy, would
pose a seriousthreattothetwoChi-
nese companies’ bidto go global.
Marcus had another reasonto
include WeChatandAlipay inthe
Senate hearing.His aim wasto win
the US government’s supporton
the pretextoftaking onChinese
companies amid Sino-UStrade
disputes, soFacebook could realize
its ambitionto make Libra a global
negotiable instrument.
Furthermore,the developmentof
cryptocurrencies could be aimed at
thwartingthe internationalizationofthe yuan.To ensure Libra’s stabil-
ity,the US dollar and securities are
boundtohavethe largestshare in
Libra’s basketof assets giventhat
thedollar is much more stablethan
the yuan, orthe euro or yen.There-
fore,the widespread application of
Libra would strengthenthe dollar’s
status morethanthatof any other
currency.In fact,bycontrolling
Libra,the US administration could
even dominatethe currency and
financial markets.
To ensurethe yuan’s internation-
alization process is notthreatened
bythe rising wave of cryptocurren-
cies,China shouldtake measuresto
widenthe reach of its currency, and
introduce a global cryptocurrency
centered on theyuan, if needed.The authorisaprofessoratthe
International InstituteofBigData
in Finance andBusinessSchool,
Beijing Normal University.The
viewsdo notnecessarilyrepresent
thoseofChinaDaily.FacebookpaymentsystemispositionedaschallengetobidsbyWeChat,Alipaytogoglobal
Beware thedesigns ofLibra
CHINA DAILY GLOBAL WEEKLY August 2-8, 2019 COMMENT 23