Title: Saudi Arabia’s Sports Investments: A Strategic Move Beyond Profit
In the realm of sports journalism, it’s a common belief that money is the key to all inquiries. However, when considering Saudi Arabia’s colossal investments in sports during the leadership of Crown Prince Mohammed Bin Salman, the tale isn’t solely about money.
At its core, there’s a clear motive for financial gain. Saudi Arabia’s sovereign wealth fund, boasting assets worth US$925 billion in 2023, primarily aims to transform oil revenues into an increased national income.
In the past year, the nation’s Public Investment Fund reported profits of $36.8 billion. Since 2016, it has allocated $51 billion towards sports assets.
The objective isn’t to transform Bin Salman into the top sports entrepreneur worldwide. Instead, his goal involves enhancing Saudi Arabia’s economic and geopolitical standing via sports investments while securing the Saudi regime’s longevity.
Beyond investing in renowned entities like Newcastle United and LIV Golf
Sports investments have become a popular method for emerging nations to make their global presence known. Rather than focusing solely on mega-events, Saudi Arabia has chosen a more varied and spread-out strategy.
The Public Investment Fund’s most well-known investments include the 2021 acquisition of the English Premier League’s Newcastle United and the takeover of the LIV golf tour, which posed a threat to the PGA’s long-held supremacy in the sport.
Additionally, Saudi Arabia has funneled sizable funds into esports, wrestling, and motorsports alongside less profitable ventures like chess and snooker. This implies that the country views its sports investments as a loss leader – an unprofitable venture designed to stimulate profitable activities elsewhere.
‘Sportswashing’
A common term for Saudi Arabia’s approach is ‘sportswashing’ – utilizing sports to improve national image in hopes of gaining global influence.
However, for Bin Salman, sports investments are just a fraction of a larger blueprint to prepare Saudi Arabia for a future with declining oil demand and complex geopolitical dynamics.
As part of Saudi Arabia’s official grand strategy, Vision 2030, sports diplomacy plays an integral role in modernizing the economy and foreign policy while preparing for a multipolar era with power distributed amongst various states.
The Big Payday’s Attraction
To Western observers, the normalization of authoritarian capitalism – economic liberty without political freedom – is the most concerning implication of Saudi sports investment. Alongside countries like China, Russia, and Singapore, Saudi Arabia represents an alternative to Western democratic capitalism as a development pathway.
The Way Forward?
So, what can be done? The options for Western nations are limited. After all, Saudi Arabia’s investments are legal and desired by both private and public sectors.
Attempts at regulatory intervention to limit Saudi influence could be made. However, sports and video games don’t pose a national security risk, making US regulatory intervention unlikely.
The Saudi Strategy is Proving Effective
The brilliance of Saudi Arabia’s approach is that it’s a power projection by consent. Investors and fans are attracted to what Bin Salman offers, governments have limited options, and critics struggle to muster effective counterarguments.
For Saudi Arabia, this sports investment strategy is about more than just profit. It’s about securing the kingdom’s future prosperity and the survival of the Saudi dynasty. So far, the strategy seems to be paying off.
Aaron Ettinger is an associate professor of international relations at Carleton University.
This article is adapted from the original version published on The Conversation under a Creative Commons license.
