French football team Paris Saint-Germain has recently signed a record sponsorship deal with Qatari National Bank. This deal is only a part in a long-term strategy designed by Qatar to forge national identity with sports as a key-pillar, says journalist and blogger James M. Dorsey in this article that takes a look into the Qatar-France relationship.

When Qatar six years ago first nibbled at acquiring Paris St. Germain (PSG), its interest reportedly evaporated because of the violence of PSG’s fans and the fact that two of the club’s key stakeholders, Canal Plus which accounted for much of its revenues through its purchase of Ligue 1 broadcast rights, and the City of Paris that owns Parc des Princes, PSG’s home stadium, felt queasy about signing a deal with a non-democratic ruler.

The unease on both parts evaporated, according to French media reports and sources, when four years later then French president Nicolas Sarkozy invited Qatar’s crown prince, Sheikh Tamim Bin Hamad al-Thani, and European soccer body UEFA president Michel Platini to the Elysée Palace for a lunch attended by Sebastien Bazin, the European representative of PSG’s majority American owners Colony Capital. The lunch, the media reports and sources said, was designed to salvage the financially troubled club at a time that it was haemorrhaging an estimated €20m a year. It crowned several months of efforts by Mr. Bazin to rekindle Qatari interest in the financially troubled club.

A three-way deal

On the table, the reports and sources said, was a three-way deal: Qatar would acquire PSG and step up its already substantial investments in France, Mr. Platini, a member of world soccer body FIFA’s executive committee would vote in favour of Qatar’s bid to host the 2022 World Cup whose son has reportedly since gone on to be legal advisor to Qatar Sports Investment; and Qatar’s state-owned Al Jazeera television network would have an opportunity to buy a stake in France’s Ligue 1 broadcast rights.

Mr. Sarkozy “was very interested in the dossier. He was keen because these people wanted to invest in France, but also because he’s a (PSG) supporter,” then Elysée spokesman Franck Louvrier was quoted as saying.

The deal spotlights economically troubled France as a prime example of how Qatar leverages its financial clout to its commercial and political advantage with business ventures as well as joint diplomatic initiatives in what amounts to a love affair with France based on a concerted effort by the French to woo the gas-rich Gulf state that started when Mr. Sarkozy was still interior minister.

Qatari holdings in France

To cement the relationship, the French parliament passed a bill in 2009 that granted a capital gains tax exemption to Qatari companies on property they own in France. An appendix to the bill stresses the "very strong" and "privileged" relations between France and Qatar, based on "the wish of the Qataris to diversify their alliances and their partnerships so as not to depend exclusively on the United States".

Qatari holdings in France include significant real estate properties, including the controversial restoration of 17th century Hotel Lambert in Paris; the equally controversial investment of millions of euros into the promotion of economic activity in France’s depressed and neglected suburbs through small and medium-sized enterprises; sponsorship of Prix de l'Arc de Triomphe, France's most famous horse race; the acquisition of PSG and the club’s €100 million sponsorship deal with Qatar National Bank ; as well as investments in major French companies, including Total oil group, construction firm Vinci, Veolia Environment and Louis Vuitton Moët Hennessy (LVMH), the world's largest conglomerate of luxury products and French art.

Qatar also has an approximate ten per cent stake in Lagardere Unlimited, the French media company that owns 70 per cent of World Sports Group (WSG), the Singapore company linked to disgraced former FIFA vice president and Asian Football confederation president Mohammed Bin Hammam, a Qatari national. (For the record, WSG has initiated legal proceedings to force this reporter to reveal his sources for his reporting on the company, which it alleges is defamatory).

In an interview with Al-Monitor, Qatar’s ambassador to France, Mohamed Al Kuwari, explained Qatar’s interest in France, saying that “you invest in France, you build partnerships and you go elsewhere, to Africa, to Asia. We are looking for strong partners like Total, Vinci, Veolia.” Moreover, he said, that France, like Qatar, “has an independent policy, plays an important role in the world, diplomatically and politically.”

Al Jazeera warms up to 2022

The three-way deal served both French soccer and Qatar’s stated-owned global broadcaster, Al Jazeera, best known for its coverage of the Middle East and North Africa. With Orange opting not to bid for the French league’s 2012-2016 tender, income from broadcast rights, the financial lifeline of French clubs, was likely to drop with Canal Plus left as the only expected contender. That changed with Al Jazeera’s entry into the fray. Its purchase of French broadcasting rights for €300 million ensured that revenues remained at levels to those comparable in recent years.

The deal allowed Al Jazeera to burnish its sports credentials ahead of hosting the World Cup in 2022 as part of a broader effort by the Gulf state to project itself. It also expanded Al Jazeera’s franchise in a country that had no real sports-only channel in preparation for a time when pan-Arab broadcasting is likely to be overshadowed by local and national television stations that have emerged as a result of a more liberal media environment in the region. The franchise adds to Al Jazeera ownership of the exclusive broadcasting rights in the Middle East for Spain’s La Liga and Italy’s Serie A as well as the 2018 Russia and 2022 Qatar World Cups.

Moreover, Al Jazeera this year launched belN in the United States with an English and a Spanish-language channel in a bid to cash in on America’s growing appetite for soccer, start promoting its hosting of the World Cup a decade from now and persuade reluctant American viewers and cable providers who long viewed the broadcaster as an Al Qaeda mouthpiece to start watching its news coverage. The Spanish channel will feature Latin American soccer alongside Spanish and Italian matches.

Controlling soccer rights is a key tool

Al Jazeera’s aggressive coverage of the popular revolts in the Middle East and North Africa in line with Qatari foreign policy and its reshaping from the outset of the Arab media landscape through its mix of relatively independent reporting and free debate sets it apart from most other state broadcasters in the region. Nonetheless, with long-standing popular discontent exploding into anti-government protests on the streets of Arab capitals, controlling soccer rights is a key tool in a football-crazy part of the world.

"We are going to look at all the opportunities in Europe. We are going to study each market one by one, and if there is room for another channel, then we will go,” said Nasser al-Khelaifi, director of Al Jazeera Sports who also is head of PSG.

Mr. Al-Khelaifi’s hope that PSG would win the French title this year has been dashed but that need not prevent the club from achieving his goal of competition in the Champions League within three years, a goal of equal significance for Al Jazeera, the world’s fastest growing broadcaster in terms of audience.

Qatar like the United Arab Emirates sees sports in general and soccer in particular as a way to enhance its international prestige, punch internationally above its weight, build sports as an economic sector that enhances tourism and makes it a key node in the world’s sports infrastructure and create leverage for further business opportunities. Qatar has gone however a step further by identifying sports as a key pillar of a national identity it is trying to forge. In an uncertain world, the strategy constitutes a sophisticated development of a long-standing Gulf policy that seeks security by embedding the region’s states with small populations as key players with multiple friends into the core of international relations.

An expert on Qatar who requested anonymity argues that “Qatar needs all of this to survive. It needs to be everywhere to compensate for its geo-political vulnerability. It doesn’t have the means to pursue a long-term strategy by implementing itself abroad or through its investment policies. They are handicapped by their own demographics,” he said referring to the fact that Qatari nationals account for approximately 20 per cent of Qatar’s population of 1.7 million. As a result, he says, “Qatar is projecting itself as the global center of the Arab world and a 21st century center of the Islamic world.”