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Hard times for Argentine clubs
( 2002-01-23 10:20 ) (7 )

Like their once proud nation, Argentina's world-renowned soccer clubs have fallen on hard times and they are having to make tough decisions.

Burdened by hefty debts, clubs are having to either lend out players, cut their salaries or do the unthinkable -- sell them outright to bring in desperately needed cash.

It is a sorry outlook for a nation that started 2002 with three of its coaches -- Marcelo Bielsa, Carlos Bianchi and Hector Cuper -- in the top four world rankings and could boast that Boca Juniors had won the Libertadores Cup for the second time and were runners-up in the World Club Cup.

But just as Argentine firms have started to fold after the country defaulted on its massive debt pile, devalued its currency and saw its elected government topple amid the worst civil unrest in a decade, clubs are under threat too.

Even the presidents of long-standing rival clubs such as Boca Juniors and River Plate, more used to trading insults than views on their survival, concur on one point" "There is going to be no other option but to keep selling players as problems and debt negotiations continue to crop up," complained San Lorenzo president Alberto Guil, who had to sell goalscorer Bernado Romeo for $5 million ahead of the Copa Mercosur final against Brazil's Flamengo on Thursday.

"The whole team is up for sale," he added, saying the club were facing 37 law suits demanding they file for bankruptcy.

CONTRACTS RENEGOTIATED

With some clubs burdened with debts of up to $30 million, government measures from devaluation to restrictions slapped on some bank deposits have only complicated matters.

Player contracts are up for renegotiation as deals formerly paid in dollars are forcibly changed to pesos under the government's economic crisis plan to drag the economy out of a grinding four-year recession.

"If we don't (cut player salaries and bonuses), the truth is Argentine soccer will disappear," said Julio Macchi, vice president at River. "On this we are in total agreement with Boca."

Despite a ban on buying and selling players until they have settled an outstanding $2.5-million debt with former forward Claudio Caniggia, Boca had to lend out Colombian keeper Oscar Cordoba to Italy's Perugia to bring in $400,000.

Boca have had to bring home little-known forward Julio Alcorse from Switzerland's Lugano and defender Diego Crosa from Spain's Betis.

"This is a tough spot economically, in which we must handle ourselves with a lot of care and cannot spend more than we earn," said Boca vice president Pedro Pompilio.

PLAYER LOANS

Boca's big rival River, nicknamed the "millionaires" because of the large transfers they have made since professional soccer began in the 1930s have beefed up their team -- but through player loans.

River have taken Juventus players Daniel Fonseca and Juan Esnaider on loan while they wait to see if an English or Italian side buys young midfielder Andres D'Alessandro, seen as Argentine soccer's big hope by Diego Maradona and Pele alike.

"If we sell D'Alessandro for $20 million and renegotiate the debt River has, we could end up with 30 million pesos, which would wipe out the club's debts," a top club official said on condition of anonymity.

River are renegotiating the contracts of their players, who in some cases earned bonuses of up to $700,000 a year, and have sidelined Martin Cardetti because he does not want to accept new post-devaluation payment rules.

Argentina's peso has fallen more than 45 percent from the old pre-devaluation one-to-one rate that reigned for a decade, which means many salaries have been almost halved in dollar terms.

"River are in a tight spot and cannot escape the crisis gripping the country," said club president Jose Maria Aguilar. "We are doing a balancing act to be able to meet our pledges. River lose $2 million a month simply by staying open."

Others have looked for different ways to boost revenues -- by either contracting out the management of the club to a private company or signing marketing deals.

Racing Club, who won their first local title in December after a 35-year drought, are now managed by private company Blanquiceleste S.A., which has a decade to generate enough revenues to pay off a $65 million debt.

Even the Argentine Football Association (AFA) has run out of money and with players' salaries yet to be paid by clubs the first official tournament due to start in February could well be delayed.