Barcelona: Huge debt, terrible transfer record and Xavi leaving - what's went wrong?

While not at the levels of Jürgen Klopp, Xavi recently announced his shock decision to depart Barcelona at the end of the season. The 44-year-old enjoys legendary status at Camp Nou after an illustrious playing career that yielded eight La Liga titles and four Champions League trophies. After hanging up his boots, Xavi embarked on his managerial career away from the spotlight at Al Sadd in Qatar, winning seven trophies before his high-profile return to Barcelona in November.

It seemed a match made in heaven and Xavi delivered their first league title in four years in 2023 despite considerable financial restraints. Club president Joan Laporta’s high-risk accounting may have kept Barcelona in business but they are a shadow of the club that won four Champions League titles during a ten-year period between 2005 and 2015. The Catalonian club were the envy of clubs across Europe with their scintillating style of play and world-class talent, but Xavi quitting his beloved club is just another sign of an ominous future. So, where did it all go wrong?

Neymar’s record departure and terrible transfer strategy

It’s difficult to pinpoint the precise moment that Barcelona’s poor decision making began but Neymar’s departure in 2017 seems an optimum moment. It would be erroneous to label the following years after Neymar’s exit as a demise as Barcelona won the title in consecutive seasons but they completely wasted the €222 million they received from PSG for the Brazilian - still the world record fee. Barca essentially replaced Neymar with two players, Philippe Coutinho and Ousmane Dembélé for exorbitant fees and both flopped massively. Dembélé joined from Borussia Dortmund for €135m from Borussia Dortmund in the same window as Neymar’s departure but failed to impress and left for PSG last summer for a loss of €85m. Coutinho arrived for €135m in January 2018 but flattered to deceive before departing permanently three and a half years later for just €20m. It’s widely reported that Barcelona’s wage bill rose exponentially by around €160m from 2017 to 2019 when Antonie Griezmann arrived from Atlético Madrid. After Dembélé and Coutinho, Griezmann became Barcelona’s third signing over the €100m threshold - costing €120m - but again, the Frenchman proved to be an unsuccessful addition. Griezmann won just one trophy at Barca before returning to Atlético permanently for just €20m and rejuvenating his career. The trio cost Barca almost €400m but they only combined to provide 100 goals and 71 assists between them in 393 games.

"Of the 10 most expensive signings in Barcelona's history, it could almost be said that none of the top three have been successful at Camp Nou,” Ivan Turmo, Transfermarkt’s Area Manager for Spain explains. “The arrivals of Ousmane Dembélé and Philippe Coutinho to compensate for the absence of Neymar were very disappointing. The Frenchman was always hampered by injuries and the Brazilian never performed at an acceptable level after his arrival in the 2017/18 winter transfer window. “Something similar happened with Antoine Griezmann, the third record signing, who never fully adapted to Barcelona and was unable to demonstrate Atlético's high level. The three involved an overall investment of almost €400m and later caused the serious economic problems that limits the Spanish club. The economic issue is central to its decline. In addition to the lack of continuity of the coaches and the general instability that has reigned at the club in recent years has led to the current situation, which is perfectly reflected on the pitch".

Barcelona’s bleak financial positions and debts of €1.2 billion

Barcelona’s bleak economic prospects have created a dark clouds over the club for years and they show little sign of evaporating. Barcelona’s wage to turnover ratio spiralled out of control from 2017 - with Lionel Messi reportedly earning close to €650 million over a four year period from then - and they were devastated by the Covid pandemic, losing around €470m in revenue. That resulted in unsustainable losses and it ultimately led to the departure of Messi, their most treasured son, when they couldn’t afford to keep him. Laporta famously implemented “economic levers” to starve off financial disaster by selling off future revenues - TV income and media rights. Barcelona’s shirt sponsorship and stadium naming rights were combined and sold to Spotify, while major banks provided 25-year corporate bonds secured against future revenue increases after the Camp Nou’s redevelopment. With the biggest net debt in football in excess of €1.2bn, Barcelona remains in a precarious financial position despite Laporta’s accounting.

Can Barcelona return to the summit of Spanish and European football?

It’s extremely unlikely that Barcelona will reverse their fortunes this season to mount a title challenge as they sit ten points off rivals Real Madrid and surprise package Girona. Barcelona also still need to face the top three in La Liga away from home and it’s imperative they qualify for the Champions League next season due to the financial incentives. In stark contrast to Barcelona’s chaotic transfer approach, Madrid have implemented a more logical policy as they’ve slowly moved away from their Galacticos era. Across the last ten seasons, Madrid’s net transfer balance is almost €300m better than Barcelona’s and they’ve collected four Champions League trophies.

Madrid have also rebuilt their squad replacing ageing stars with talented young players including Aurélien Tchouaméni, Vinicius Junior, Rodrygo, Eduardo Camavinga and Jude Bellingham - they're also favourites to sign Kylian Mbappé this summer. After years of reckless spending, Barcelona need to implement a similar policy with an emphasis on their youth academy. Of Barcelona’s ten most expensive signings in their history, only two - Neymar and Luis Suarez - have been undisputed successes. Barcelona’s famed youth academy, La Masia, produced the core of one of best club sides in the history of football and they must return to that policy with a number of prodigious talents emerging in the last few years. Gavi has already established himself as a key player and Lamine Yamal has joined his fellow academy graduate this season - while another youngster Pedri joined from Las Palmas for a small fee. Still just 16, Yamal’s market valuation rose by an insane €35m since the start of the season and the Spaniard has the best dribble success rate (70.6%) in Europe's top five leagues this season. Barcelona may have to revert to successful past traditions to ensure they have a bright future and rise to the top of European football once again.