The outsized role that Saudi Arabia has come to play in global sport was highlighted last week in a major row over Lionel Messi, the world’s greatest footballer.
Messi has been suspended by his club, Qatar-based French club Paris Saint-Germain (PSG), for making an unauthorized trip to Saudi Arabia as part of his role as ambassador for the Saudi Tourism Authority. The Argentine is now expected to leave PSG with the Saudi league a possible destination.
Messi earns tens of millions of euros for this Saudi role, part of the huge spending the kingdom is currently putting into professional sport.
A 2021 report by London-based human rights group Grant Liberty found that Saudi Arabia had spent $1.5 billion on professional sport in previous years. This figure has risen dramatically over the past two years as investment in football, golf, motor sports and cricket increases.
The country’s sovereign wealth fund – the Public Investment Fund (PIF) – According to the tour’s former COO Atul Khosla, the company spent nearly $800 million on its LIV golf tour in 2022 alone. Meanwhile, the PIF bought English soccer club Newcastle United for around €400m ($438m) in 2021 and has since spent more than €300m on new players. A fortune has been spent in domestic Saudi football to get Cristiano Ronaldo into the league.
The kingdom also recently announced plans to drastically increase spending on cricket. It aims to become a ‘global cricket destination’ by creating one of the most lucrative tournaments in the world.
Earlier this year, it was reported that Saudi Arabia was even on the verge of buying all of Formula 1 motorsport, worth more than $20 billion.
Lots of sports, lots of sportswear
A number of critics accuse Saudi Arabia of operating “sports laundry” on a large scale. The campaign organization Greenpeace defines sportswashing as “the act of sponsoring a sports team or event to distract from bad practices elsewhere”. This tactic is often used by companies and governments with poor environmental or human rights records to exploit people’s love of sport to “wash their image clean.
The Saudis have been accused of sports laundry over English football money
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Saudi Arabia certainly has an image problem. According to Amnesty International, the country is guilty of numerous cases of human rights abuses, from a lack of freedom of expression and the continued use of the death penalty to the lack of rights of migrants and the severe, institutionalized oppression of women and girls.
Another major topic in recent years was the murder of journalist Jamal Khashoggi in the Saudi consulate in Istanbul in 2018. Since then, it has triggered global outrage and severe criticism of the Saudi government.
Jon B. Alterman, director of the Middle East program at the Center for Strategic and International Studies, says the goal of Saudi Arabia’s massive sports spending is to build a more positive image of the country overall.
“The country’s leadership wants the international public to have a positive association with the kingdom,” he told DW. “When Western audiences think of Saudi Arabia, many first think of things like undeserved oil wealth, terrorism and gender segregation.”
Crown Prince Mohammed bin Salman is the man behind Saudi’s openness to the worldImage: IMAGO/Le Pictorium
He says Crown Prince Mohammed bin Salman, the de facto ruler of Saudi Arabia, and the leadership team around him see sport as an essential part of their overall strategy to transform the country’s international political and economic position.
“The Saudi leadership sees their country as dynamic and modern and hopes the sport will highlight the way in which Saudi Arabia is similar to the rest of the world, rather than the way it differs from the rest of the world “, he said.
Focus on tourism
Creating more positive associations can ultimately have a direct impact on the country’s economy. It is no coincidence that Messi is pushing tourism as the country’s leadership sees it as an important sector in their quest to diversify the country’s economy from its current oil dependency.
Around 40% of Saudi GDP is oil-based, while nearly 80% of the country’s export earnings are tied to oil production.
The country’s tourism revenue soared in 2022 and the government has extremely ambitious plans to attract around 100 million visitors a year by the end of the decade as part of Bin Salman’s strategic framework, Saudi Vision 2030.
The much-touted Neom project – a so-called smart city that Saudi Arabia plans to build in the north-west of the country – has been described by the government as “the most ambitious tourism project in the world”.
A computer generated image of Neom, the city at the center of Saudi Arabia’s tourism map. Image: NEOM/AFP
Still, it will be a big challenge to attract such a large number of foreign visitors. Around 16.5 million foreign visitors came to the country last year.
Make friends and influence governments
The IMF forecasts that Saudi economic growth will more than halve to 3.1% this year, mainly due to a slowdown in the oil sector.
But a record-breaking 2022, which saw state-owned oil company Saudi Aramco post record profits of $161 billion, means the Saudi government has been able to pump money into the PIF, which it’s using to fuel its strategic investments in esports and elsewhere.
According to this week’s numbers, non-oil economic activity rose 5.8% year-on-year. “The Saudi economy is robust and there is growing interest from the global business community in expanding ties with Saudi Arabia,” Alterman said.
China and Saudi Arabia have established close economic ties. Image: Saudi Press Agency/REUTERS
One of these partners is China. As Saudi Arabia’s main trading partner, business between them has expanded well beyond the oil sector in recent years. Saudi Arabia is now importing large amounts of Chinese technology, much of it for weapons, as it builds out its military.
Criticism of Saudi Arabia’s sports investment will continue, but the long-term success of the strategy seems inevitable, Alterman said.
“Emirates Airlines’ sponsorship of several European football clubs for more than a decade shows how sports sponsorship can increase branding and awareness,” he said, citing the success of Dubai, one of Saudi Arabia’s regional rivals.
“Saudi Arabia wants people to be curious about the kingdom.”
Given that the company has now gained a foothold all over the world in some of the most popular and lucrative sports, this is clearly already the case.
Edited by: Uwe Hessler
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