Saudi Arabia's Soccer Revolution: Surprising Reasons
In a surprising move, Saudi Arabia has set its sights on shaking up the global soccer landscape. This unexpected foray into the world of soccer has left many wondering about the motivations behind it.
One of the most striking examples of Saudi Arabia's soccer ambition was the reported $1.1 billion bid made by Al-Hilal, a Saudi Arabian club, to sign French soccer superstar Kylian Mbappé.
This astronomical sum included a staggering $775 million salary offer to Mbappé for just one year, on top of a $332 million transfer fee to his then-club, Paris Saint-Germain (PSG). While Mbappé declined the offer, another high-profile player, Neymar Jr., said yes to Al-Hilal, making a move from PSG for approximately $98.5 million (€90 million) plus additional incentives.
This transfer window saw Saudi Pro League (SPL) clubs spend close to $1 billion to acquire 94 overseas players from top European leagues, including France's Ligue 1, Spain's La Liga, Italy's Serie A, Germany's Bundesliga, and the English Premier League, according to Deloitte.
Despite Saudi Arabia's questionable human rights record, the country's extravagant spending on its domestic soccer league indicates its determination to make a significant impact in the world of sports.
Saudi Crown Prince Mohammed bin Salman, often referred to as MBS, openly acknowledges this strategy, dismissing criticisms of “sportswashing.” In an interview with Fox News, he stated, “If sportswashing is going to increase my GDP by one percent, then I will continue doing sportswashing.” He remains unfazed by the term, emphasizing his goal of boosting GDP through sports.
SPL's top 20 player transfers in 2023
Several Saudi clubs, now under the ownership of the nation's sovereign Public Investment Fund (PIF), have attracted some of the biggest names in the soccer world. For instance, Cristiano Ronaldo, a five-time Ballon d'Or winner, joined Al-Nassr on a two-year contract, reportedly earning an estimated $200 million per year, making him the highest-paid soccer player globally.
As of now, 21 of the most expensive soccer players in Saudi Arabia, in terms of transfer fees, play for PIF-owned clubs. However, the SPL remains tight-lipped about the exact financial details, including player and coach salaries, citing competitive reasons.
The PIF, with $777 billion in assets under management, aspires to reach $1 trillion in the near future. In 2021, the fund acquired English soccer club Newcastle United before shifting its focus to domestic investments, making it one of the top spenders on players in the process.
Notably, even Saudi clubs not owned by the PIF are making substantial investments in star players. For example, former Liverpool captain Jordan Henderson was reportedly offered a salary of $870,000 (£700,000) per week, totaling an estimated $15 million (£12 million) transfer from Liverpool to Saudi team Al-Ettifaq.
Saudi Arabia's interest in soccer aligns with its larger vision for the future, including hosting the 2023 FIFA Club World Cup and bidding for the 2027 AFC Asian Cup. There have also been reports of a potential joint bid with Greece and Egypt for the 2030 FIFA Men's World Cup, although this remains uncertain.
One key factor driving this soccer investment is Saudi Arabia's young population, with over 80% of the youth engaging with the sport. The government aims to provide a thriving soccer industry to keep its younger population engaged and deter potential radicalization or anti-government sentiments.
However, concerns about human rights abuses persist, as Amnesty International has documented a rollback in human rights in Saudi Arabia, including crackdowns on freedom of expression and an increase in criminal prosecutions. Reputation and foreign investment are important for Saudi Arabia's economic diversification plans, making the balance between soccer investment and human rights a delicate one.
Lack of transparency: Saudi threatens new systems of governance in sports
In terms of transparency, Saudi Arabia differs significantly from European soccer governing bodies, which have financial fair play (FFP) rules and salary caps. The lack of transparency surrounding Saudi clubs' finances raises concerns about the potential dilution of UEFA's FFP regulations and the impact on global soccer governance.
While Saudi Arabia's soccer ambitions are grand, the future remains uncertain, and the success of its investment strategy remains to be seen. Saudi Arabia seeks to diversify its economy and attract foreign investment as it faces declining oil revenues, but the path to becoming a soccer powerhouse presents both opportunities and challenges for the kingdom.
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