The Gulf Could Own Global Sports Soon
Middle Eastern countries are spending billions on sporting infrastructure to gain more cultural influence and diversify their oil economies.
WHY YOU SHOULD CARE
The most sought-after teams and venues of the future might be owned by countries in the Middle East.
Eddie Hearn was feeling emotional. Flanked by boxers Anthony Joshua, a former heavyweight champion, and Andy Ruiz Jr., a Mexican-American fighter who shocked the sport by winning their bout in June, the British sports promoter was in Diriyah, a historical site in conservative Saudi Arabia, talking up the next championship bout.
In comparison to the usual pre-fight press conference, it was a polite affair. The boxers avoided trading insults and praised their hosts. Interviews were conducted after prayers.
“Sometimes our sport is very narrow-minded,” says Hearn. “There’s Las Vegas, there’s New York, there’s London. [But] there’s a whole world out there and now there’s Saudi Arabia for boxing.”
It has changed the face of world sport.
Simon Chadwick, Salford Business School
Hearn acknowledges that some people think Saudi Arabia is a “strange destination” for a global sports event. But he boldly predicts that the Dec. 7 title rematch, dubbed the “Clash on the Dunes,” will go down in boxing history alongside Muhammad Ali’s “Rumble in the Jungle” with George Foreman in Zaire and the “Thrilla in Manila” against Joe Frazier.
Riyadh has spent about $50 million to secure the rights to host the fight as sports become the latest platform through which Crown Prince Mohammed bin Salman looks to deploy the kingdom’s financial muscle to project the country onto the global stage and shake up the nation’s conservative society — all part of his Vision 2030 program of economic reform.
In doing so, Riyadh is following in the footsteps of neighboring Qatar and the United Arab Emirates, which have invested billions of dollars to make their mark on the international sports arena.
It’s a trend rippling through the sporting world as the region’s absolute monarchies splash the petrodollars to lure superstars and top events.
Its impact has been most notable in soccer, from the decision to award Qatar the 2022 World Cup to the hundreds of millions of dollars Abu Dhabi and Doha have spent transforming Manchester City and Paris Saint-Germain soccer clubs, inflating wages and transfer fees in the English and French leagues, respectively. But it’s also having repercussions across motorsports, tennis, golf and, now, boxing.
Some grumble that Gulf states’ financial clout is distorting markets, while campaigners accuse autocratic regimes of using sports brands to deflect attention from poor human rights records.
Simon Chadwick, a professor of sports enterprise at the United Kingdom’s Salford Business School, says the phenomenon is changing the global sports industry “tangibly and intangibly.”
“It has changed the face of world sport,” Chadwick says. “There’s an expectation that the region is going to be a source of revenue … [and] it increases expectations about what it takes to bid for and organize an event.”
The entry of Saudi Arabia, which boasts the Middle East’s biggest economy and the Arab Gulf’s largest population, into the sports bidding market could have the most impact yet.
“The sky is the limit for us because it is the mandate within the 2030 Vision to host the best competitions, to promote Saudi in terms of tourism and to use sports, culture and entertainment as a tool,” says Prince Abdulaziz bin Turki al-Faisal, chairman of the kingdom’s General Sports Authority.
Days after Joshua and Ruiz exchange blows in a 20,000-capacity open-air stadium, with front-row seats selling for $13,000, Diriyah will host a $3 million tennis tournament that promises to feature “eight of the finest men’s players on the planet.” In January, Saudi Arabia will stage the Paris-Dakar rally, an annual motor racing event, for the first time.
The same month, Spain’s top four soccer teams, including Barcelona and Real Madrid, will compete in the Spanish Super Cup in Jeddah. The new version of the tournament will earn the country’s soccer federation between 35 million euros to 40 million euros a year over three years.
Officials in the Gulf states say the investment is part of the broader effort to diversify oil-dependent economies and help boost tourism, brand awareness and standards in their hospitality industries.
Qatar is spending more than $200 billion on infrastructure associated with the World Cup; Abu Dhabi’s Formula One track is the centerpiece of the $40 billion development of Yas Island. As Saudi Arabia plays catch-up, it plans to pour billions of dollars into its Qiddiya sports and entertainment project, which will have a motorsports complex and an “Olympic-style” city near Riyadh.
The development of sports industries is also viewed as important in the creation of more entertainment options for youthful populations, and in battling some of the world’s highest obesity levels.
But experts say there are other motives at play, from the projection of soft power to what campaigners have described as attempts to “sportswash” the country’s poor human rights record. Similar complaints have been made against the UAE and Bahrain, which both host Formula One Grand Prix races.
ALQST, a U.K.-based group that monitors abuses in the kingdom, says: “They are trying to cover up their abuses by holding high-profile sporting events and spectacles supported by businesspeople, politicians and sporting figures around the world.”
Qatar has been dogged by allegations, which it denies, that it corruptly secured the rights to host the World Cup. It has also drawn criticism for its treatment of foreign laborers and its stance on LGBTQ rights. In 2011, it bought Paris Saint-Germain, which paid a world-record $244 million for Brazil star Neymar two years ago.
Despite the controversies, human rights activist Nicholas McGeehan says the soft power strategy has been largely successful.
Hassan al-Thawadi, secretary general of the Qatar 2022 Supreme Committee, insists that the tournament has acted as a “catalyst” for urban development, the growth of a hospitality industry and societal change.
“Any nation that hosts major tournaments will go through that — it’s a baptism through fire,” al-Thawadi says. He also cites “ulterior motives” in the criticism of Qatar.
Some analysts suggest that the Neymar deal was in part intended by Doha to send a message that Qatar was undeterred just weeks after Saudi Arabia, the UAE, Egypt and Bahrain imposed an embargo on their neighbor.
Yet the greater the sports rivalry becomes, the more money is likely to be spent. “If Qatar invests $1 billion, then Saudi Arabia will have to invest $2 billion,” says Chadwick.
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