Saudi Arabia’s football vision goes global
27 September 2023
MEED's October 2023 special report on Saudi Arabia also includes:
> POLITICS: Saudi Arabia looks both east and west
> GIGAPROJECTS: Gigaproject activity enters full swing
> TRANSPORT: Infrastructure projects support Riyadh’s logistics ambitions
> UPSTREAM: Aramco focuses on upstream capacity building
> DOWNSTREAM: Saudi chemical and downstream projects in motion
> POWER: Riyadh rides power projects surge
> WATER: Saudi water projects momentum holds steady
> BANKS: Saudi banks track more modest growth path
> JEDDAH TOWER: Jeddah developer restarts world’s tallest tower
Saudi Arabia has invested more than $6.3bn in sport since early 2021, but that figure will be a fraction of what is coming if plans for its 18-club Saudi Pro League bear fruit.
The kingdom’s entry into world football started in October 2021, when the Public Investment Fund (PIF) bought Newcastle United. Benefitting from a new manager and fresh on-field talent, the team came fourth in the premiership in the 2022-23 season and qualified for this year’s European Champions League.
It is said that Riyadh aims to emulate Abu Dhabi, which bought Manchester City in 2008, but the kingdom’s ambitions go beyond owning a single European club: it is aiming to remake its position in world sport.
The exertions are not dissimilar to the way in which the Brics economic grouping, which the kingdom was invited to join in August, hopes to remake the world’s monetary dogma by breaking the dollar’s grip on the global economy. The Saudi Pro League may be the kingdom’s way of ending Europe’s dominance in football.
Establishing the Saudi Pro League as one of the best will enhance the kingdom’s desire for a say at the highest levels of global club football
Mixed returns
Abu Dhabi has demonstrated that owning a football club can deliver benefits that go beyond income and capital appreciation. It has boosted the emirate’s image, promoted its airline Etihad and given Abu Dhabi a seat at the table of the English Premier League. It has also faced challenges.
Manchester City has been accused of breaching Premier League and Uefa rules about licensing and financial sustainability. In 2020, it was fined and banned from European competitions for two years for alleged breaches of Uefa’s fair play rules, though that was overruled. The club is now subject to a long-term investigation into 115 alleged breaches of Europe’s fair play rules.
Now Newcastle United, which the premiership never wanted to be bought by Saudi Arabia, is being closely scrutinised for evidence that the kingdom is unfairly boosting the club’s spending.
There are also signs that the British football boom, which began after the English premiership was created in 1992, is coming to an end. Top clubs enjoyed a windfall from satellite television rights and then the influx of investment from wealthy individuals, starting with Russia’s Roman Abramovitch 10 years later. This has now been overshadowed by the financial might of Abu Dhabi and Saudi Arabia in England and by Qatar, owner of Paris Saint Germain since 2011, in France.
But the appetite among even the wealthiest investors for football assets may be fading. Earlier this year, Manchester United’s owners rejected an offer for the club from Qatar as inadequate.
Sports Saudisation
Saudi Arabia’s new approach is different. Instead of sending money overseas, it is looking to invest heavily in football within the kingdom. In the 2023 summer transfer season, Saudi Pro League clubs spent a net $907m on players, more than all of the Big Five leagues but the Premier League, which spent $1.39bn.
The economic benefits are easily comprehended. PIF finance would go into building domestic stadiums and training facilities. Money paid to players and support staff would be retained in the kingdom. In addition to a domestic audience of football fans, Saudi Arabia has international airports and an aviation network to bring in fans from across the globe.
Establishing the Saudi Pro League as one of the best will enhance the kingdom’s desire for a say at the highest levels of global club football.
European football’s perilous financial position is why plans for a European Super League comprising 12 teams, announced in the spring of 2021, initially attracted support from the clubs involved. It was scrapped at the last minute, but dreams of a super league – and the problems that inspired it – remain. It is conceivable that the kingdom could argue a case for membership should it be revived, though that is a consideration for the future.
In the meantime, Saudi Arabia’s impact on football is already being felt. Last December, Portugal’s Cristiano Ronaldo signed for Riyadh’s Al-Nassr. Other top players that have since signed to play in the kingdom include Brazil’s Neymar, Ballon d’Or holder Karim Benzema, African Footballer of the Year Sadio Mane, World Cup winner N’Golo Kante and former Liverpool captain Jordan Henderson.
In July, Kylian Mbappe turned down an offer from Riyadh’s Al-Hilal worth almost €300m ($321.5m) and a salary of €200m for a one-season stay. But – in what would be a coup for the Saudi league if it is accepted – a world-record signing fee is reported to have been offered by Al-Ittihad in September for Egypt’s Mohamed Saleh.
Newcastle United could fit into the kingdom’s broader football plan as a source of talent that can be sold to the Saudi league to bring money into the English club while avoiding the fair play charges encumbering Manchester City. The first example of the process may have been Allan Saint Maximim, who was transferred to Al-Ahli for a reported transfer fee of almost $30m in July.
Last summer, Riyadh also launched what is now the Liv Golf League. There has also been talk of it buying a US National Football League club. The kingdom is investing in other sports as well, but it is football that it is bringing home this autumn.
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