In recent years, Saudi Arabia has made major investments in the global sports industry as part of its economic diversification strategy beyond oil and gas. The Saudi sovereign wealth fund, known as the Public Investment Fund (PIF), has allocated billions of dollars to acquire stakes in major sports leagues, clubs and events around the world. This influx of Saudi sports investments aims to transform the kingdom into an international hub for sports business and tourism. The investments cover a wide range of assets including football, golf, boxing, motorsports and more. However, these high-profile deals have also attracted controversies related to Saudi’s human rights record and sports washing accusations. This article provides an overview of Saudi Arabia’s key sports investments and their implications.
Acquiring Premier League Club Newcastle United
In October 2021, a Saudi-backed consortium acquired English Premier League club Newcastle United for $409 million. Saudi Arabia’s PIF owns 80% of the club while the rest is held by PCP Capital Partners and RB Sports & Media. This deal represents the kingdom’s first major foray into European football. As one of the richest clubs in the Premier League, Newcastle is expected to undergo significant investments in talent acquisition, infrastructure and commercial activities under its new Saudi owners. Some analysts view this as an attempt by Saudi Arabia to sportswash its image and deflect criticism of its human rights issues. But the club’s new owners have emphasized their commitment to invest responsibly and promote Newcastle as a force for good.
Hosting High-Profile Boxing and Golf Events
Saudi Arabia has signed multiple long-term partnerships to host major boxing and golf tournaments. In 2022, the kingdom hosted several high-profile boxing title fights including Anthony Joshua vs. Oleksandr Usyk and Canelo Alvarez vs. Dmitry Bivol. These events were organized by Skill Challenge Entertainment, a subsidiary of Saudi Arabia’s General Sports Authority, in collaboration with boxing promoters like Matchroom Boxing. Saudi Arabia also hosts the Saudi International golf tournament, part of the Asian Tour, sponsored by PIF. The event has attracted top golfers including Tiger Woods, Dustin Johnson and Phil Mickelson. Critics allege the kingdom uses such sporting extravaganzas to gloss over its human rights abuses.
Investing in Motorsports and F1
Saudi Arabia made significant moves into the world of motorsports through partnerships with Formula 1 and electric racing series Formula E. A Saudi Arabian Grand Prix was added to the F1 calendar in 2021 on a long-term deal. Meanwhile, the kingdom has hosted Formula E races in cities like Diriyah. These races are organized by Saudi motorsports authorities like the Saudi Automobile and Motorcycle Federation. In 2022, PIF acquired a 5% stake in McLaren Racing as part of a larger £400 million funding round. This provides Saudi exposure to one of F1’s top teams. However, some argue that Saudi involvement in motorsports allows the regime to divert attention from its repression of activists and dissidents.
Building Sports Infrastructure and Hosting Major Events
The kingdom is building massive new sports infrastructure as it aims to become a hub for global events. PIF is developing several new stadiums, arenas and training facilities as part of its strategy. In 2029, Saudi Arabia will host the Asian Winter Games at a $500 billion futuristic megacity project called Neom. It has also hosted events like WWE’s Crown Jewel, boxing title matches, Spanish Super Cup and Formula E races. Additionally, the Saudis are planning a bid to co-host the 2030 FIFA World Cup. While boosting sports tourism is one goal, critics say these efforts lend undeserved prestige to the regime.
In summary, Saudi Arabia’s sovereign wealth fund has made substantial investments in premier league football clubs, motorsports, golf, boxing and other sports assets. The kingdom aims to diversify its economy, boost sports tourism and host major international events. However, these deals have been controversial due to sportswashing accusations and human rights concerns. It remains to be seen how Saudi sports investments will continue shaping the global sports industry.