Getty Images
- Saudi Arabia is pouring billions into sports in a bid to transform its economy.
- Crown Prince Mohammed bin Salman has made the sector a key part of his Vision 2030 plan.
- The Saudis have bought Newcastle United and bankrolled a breakaway golf competition since 2021.
Saudi Arabia is on a drive to transform its oil-reliant economy – and big sports stars like Cristiano Ronaldo, golfer Phil Mickelson, and boxer Anthony Joshua are all part of the plan.
Spending billions of dollars on sports is a key part of Vision 2030, an ongoing project spearheaded by Crown Prince Mohammed bin Salman that aims to make his country less dependent on crude and cement its place on the world stage.
Many of the Gulf kingdom's critics say the investment drive is a blatant example of "sportswashing" – co-opting sport to launder the image of an authoritarian regime that executed almost 200 people last year and is widely believed to have ordered the brutal killing of Washington Post journalist Jamal Khashoggi in 2018.
But the reality is that the crown prince has a grander ambition: to level up Saudi Arabia's economic growth.
Sports spending spree
The world's biggest oil exporter has ploughed billions of dollars into soccer, golf, combat sports, and Formula 1 over the past two years.
Saudi Arabia's drive to dominate soccer hinges on an industrial city in north-east England: in October 2021, the government-controlled Public Investment Fund (PIF) paid £305 million ($372 million) to buy an 80% stake in Premier League club Newcastle United after 18 months of negotiations.
In just under two years, they've spent hundreds of millions of dollars on new players to help the perennial underachievers qualify for Europe's top competition, the UEFA Champions League.
Steve Luciano/AP
Ronaldo joined Riyadh-based Al Nassr in January, setting the stage for PIF to lure some of the world's best players to Saudi Arabia.
In June, the fund took controlling stakes in the country's four biggest clubs – and Ballon d'Or winner Karim Benzema, Brazil legend Neymar, and former Liverpool forward Sadio Mané are among the big-name stars who've since swapped Europe for the Saudi Pro League.
"Soccer is by far the most popular global sport so certainly, the rationale to invest in it will always be there," Danyel Reiche, a visiting fellow at Georgetown University Qatar, told Insider. "But Saudi Arabia is piling into other sports too, because they want to achieve a lot in a short period of time."
The same month it took over Newcastle, PIF invested an estimated $2 billion in the breakaway competition LIV Golf – and global stars like Mickelson, Dustin Johnson and Brooks Koepka soon flocked to the new competition, which is set to offer prize money of $405 million this year alone.
Just two years later, LIV has effectively cannibalized the rival PGA Tour.
The competitions agreed in June to merge into a combined entity that will be funded and chaired by PIF, in what many see as a political hole-in-one for Saudi Arabia.
Beyond soccer and golf, the Kingdom has also spent tens of millions of dollars hosting high-profile events – including two heavyweight boxing fights featuring Joshua, multiple WWE shows, and an Formula 1 Grand Prix that's been held in Jeddah since 2021.
The Gulf state is also set to host an undisputed heavyweight contest between champion boxers Tyson Fury and Oleksandr Usyk in what boxing promoter Frank Warren said will be "the biggest fight that could possibly be made in our sport."
"Call it whatever you want"
Crown Prince Mohammed had a blunt response to accusations that his investment drive constituted sportswashing. "I don't care," he told Fox News last week.
If it will boost the Saudi economy, "then I will continue doing sportswashing. I have 1% growth of GDP from sport and I'm aiming for another 1.5%. Call it whatever you want, we're going to get that 1.5%."
Leon Neal/Getty Images
The crown prince's words are an indication that the kingdom is piling into sports as much to boost its own economy as rehabilitate its reputation abroad.
Crown Prince Mohammed has "set out on a sport industry journey that he's going to seek to fulfil, irrespective of how we label Saudi Arabia," says Simon Chadwick, a professor at SKEMA Business School in Lille, France.
"He laid it out very clearly … his principle objective is to secure GDP growth of between 2% and 3% through sport, and he doesn't care if we call that 'sportswashing'," he adds, noting that sport makes up a similar proportion of the US, French, and German economies.
As well as boosting growth, Saudi Arabia's sports splurge will fortify the crown prince's own political position, according to both Chadwick and Reiche.
Under-35s make up 70% of the Saudi population and the government's growing track record for luring megastars like Ronaldo – and his 600 million-plus Instagram followers – will likely boost its appeal with that demographic, they say.
"The crown prince is strengthening his authority and power by providing young people with more entertainment opportunities as a way to make them happy," Reiche tells Insider.
"In Saudi Arabia, we haven't seen what we saw in Iran, where young people have taken to the streets – and that's because bin Salman is pretty popular."
Football, fast cars, and fights
For Chadwick, three sports in particular sum up the Saudi government's desire to appeal to its young and aggressively patriarchal population.
"The triumvirate of football, fast cars and fighting have guided investment," he told Insider. "There's a macho hue to that – but Saudi Arabia is still a very macho, patriarchal society."
Riyadh's golf investments likely form part of a different strategy – to boost the country's fast-growing tourism industry, which bin Salman said last week was already accounting for 7% of all GDP growth.
"Saudi Arabia is seeking to build its tourism sector – and so golf is very much connected to its economic development," Chadwick says.
"My reading of LIV is that it's part of a strategy that will eventually lead to people choosing to make a trip to play in Saudi Arabia – rather than Miami, Augusta, or St Andrews."
Saudi Arabia won't stop pouring money into soccer, golf, Formula 1, and fighting anytime soon – but appears ready to widen its sports investment strategy as well.
Elsa/Getty Images
In June, the chair of tennis' ATP Tour said he'd held "positive" talks with PIF and other investors about creating an LIV-style competition backed by the Saudis – an idea that's already garnered support from star players including Australia's Nick Kyrgios and Tunisia's Ons Jabeur.
The state is also widely believed to be preparing to launch a new cricket competition modeled on the Indian Premier League. Officials are quietly hopeful they'll be able to woo European countries into supporting their bid to host the soccer's flagship international tournament, the FIFA World Cup, in 2034.
As Crown Prince Mohammed made clear last week, all this forms part of a broader strategy to supercharge Saudi Arabia's economy through investment. That means its huge spending is likely to remain one of the biggest stories in sport for some time.
from Business Insider https://ift.tt/N8W1JTK
No comments:
Post a Comment