The city of Bern has borrowed money from the international football association FIFA several times at short notice. Over a six-year period, there were 21 short-term loans amounting to about a billion francs, the city announced on Friday. In addition, there are 14 short-term debt financings for the institutions owned by the city and special accounts totaling CHF 0.8 billion. All told, Bern owed FIFA 1.8 billion Swiss francs!
After all: due to the negative interest, Bern made a profit of 3.1 million francs with financing from FIFA. After criticism of the origin, the city now wants to reconsider these loans. Because FIFA has repeatedly been discredited for corruption cases and tolerating human rights abuses such as in Qatar – it is not right for many to profit from such money.
Dozens of communities take out FIFA loans
Not only in Bern. As early as 2021, the SP of the municipality of Allschwil in the Basel region opposed the FIFA subsidy. The municipality had borrowed ten million francs and made a profit of 9,711 francs thanks to negative interest. The SP requested that the profits be donated – and prevailed.
A dozen communities across Switzerland are likely to borrow money from FIFA from time to time – survey by the “Aargauer Zeitung” in 2021, named among others Glattfelden ZH, Zumikon ZH, Meilen ZH, Pfäffikon ZH, Wädenswil ZH, Frauenfeld TG, Langnau ARE. Winterthur ZH also took out a CHF 60 million loan.
The annual reports of the football association give an idea of how much FIFA money is in circulation in the Swiss municipalities. In 2018 this was a maximum of 759 million, at the end of 2019 about 648 and at the end of 2020 about 376 million francs.
It is not always clear where the money comes from
In any case, Bern will hardly use the FIFA pots in the future, as the city’s press release shows. “The city is reviewing whether ethical review criteria are taken into account when borrowing money in the future,” it says. Although that should not be so easy, writes financial director Martin Aebersold.
Because today there are no generally established, uniform guidelines for evaluating ethical and sustainability criteria for external financing. And if they did: Bern received the money – like all other municipalities – through fintech platforms. In Bern, that was the financing platform Loanboox. This cannot ensure that no unwanted money ends up with the city: if you receive a financing offer, in many cases it is not known where the money actually comes from.
Previously, the financing partner had to be based in Bern, Switzerland, when raising external funds. Moreover, only the total price offered was decisive. (sf)