Saudi Arabia plans huge sports investment drive

Saudi Arabia is planning to establish a sports investment company worth billions of dollars as it expands its presence in golf, football, adventure travel, and entertainment sectors. According to the Financial Times, the sports group will be a part of Saudi Arabia’s $650 billion sovereign wealth fund, known as the Public Investment Fund (PIF). The PIF, chaired by Crown Prince Mohammed bin Salman, is central to the kingdom’s strategy of diversifying its economy away from its heavy dependence on oil revenue.

In June, the PIF-backed LIV Golf and the PGA Tour surprised the sports world by announcing a partnership that resolved a contentious legal dispute between them. However, the deal has faced criticism, with the US Department of Justice launching an investigation into the planned partnership. Nonetheless, it represents Saudi Arabia’s continued foray into the world of Western sports.

In 2021, the sovereign wealth fund acquired English football club Newcastle United. Saudi Arabia has also hosted Formula 1 Grand Prix races and is bolstering its domestic football scene by attracting high-profile players such as Cristiano Ronaldo with lucrative contracts. Ronaldo’s move to Riyadh club Al-Nassr had an immediate impact, with the club’s Instagram following surging from under one million to nearly 15 million after the deal. Additionally, the broadcast rights to the Saudi league have reportedly been sold to 36 overseas territories.

Critics have accused Saudi Arabia of investing in sports and entertainment as a means to divert attention from its poor human rights record. However, this push is part of a broader effort to reshape the kingdom’s economy and relax conservative social norms. Other Muslim footballers, including Riyad Mahrez of Manchester City, Hakim Ziyech of Chelsea, and Yassine Bounou of Sevilla, have also been linked to potential moves to Saudi Arabia.

Furthermore, Saudi Arabia aims to attract high-spending Western tourists by focusing on entertainment and sports, thereby competing with established vacation destinations in the Middle East. The kingdom is offering alternative options for young Saudis to vacation domestically and spend their money within the country. The Jeddah Yacht Club, for instance, has reportedly provided discounted rates to sailing YouTubers to encourage them to visit its state-of-the-art marina. Western sailors have begun favouring Saudi Arabia over Egypt’s Red Sea coast. The website of Neom, a futuristic $500 billion megacity being developed by the PIF, advertises activities such as kayaking, kite surfing, and sailing, positioning itself as a winter alternative to the Mediterranean.