Saudi Arabia has deployed billions from its Public Investment Fund over the last two-and-a-half years according to analysis by the Guardian, spending on sports at a scale that has completely changed professional golf and transformed the international transfer market for football.
On Monday, the Saudi Arabian club Al Hilal submitted a world-record bid for the French captain, Kylian Mbappé, understood to be worth €300m (£259m).
The $6.3bn investment is almost equivalent to the GDP of Montenegro or the island of Barbados. It dwarfs data compiled by Grant Liberty two years ago, estimating that Saudi Arabia spent $1.5bn in the period between 2014 and early 2021.
Rights groups including Grant Liberty, Amnesty International and Human Rights Watch term such spending “sportswashing” – bankrolling big-name sporting events in order to distract from a poor record on human rights.
“Previously, sports figures and brands had rejected offers to engage with Saudi Arabia due to its well-documented human rights abuses,” said Grant Liberty. “However, there has been a worrisome shift in moral stance, as lucrative deals are now being accepted despite the ongoing and deteriorating violations.”
After the 2018 murder of journalist Jamal Khashoggi, Saudi Arabia was broadly shunned, with many major corporations withdrawing or pausing investments in the country.
But the past two years have seen a shift in how the kingdom is regarded internationally. President Joe Biden, who once promised to make Saudi Arabia a “pariah” over the killing, travelled there last year, greeting the crown prince and de-facto leader, Mohammed bin Salman, with a controversial fist bump.
The Guardian has compiled and analysed a list of investments made by the Saudi Arabian Public Investment Fund – one of the 10 largest sovereign wealth funds in the world with assets estimated at $700bn – as well as other state bodies including the tourism authority, all signed since 2021. The $6.3bn total figure is probably an underestimate of the true amount, as the PIF is notoriously opaque about its finances, and details of some deals are not made public.
The purchase of Newcastle United in October 2021 by the PIF for $391m drew concerns from rights groups, notably Amnesty International, which criticised the club after leaked images showed changes to its away kit to match the colours of the Saudi national team.
Felix Jakens of Amnesty International said the choice “exposes the power of the Saudi dollar and the kingdom’s determination to sportswash its brutal, blood-soaked human rights record”.
A year later, the PIF stated its intention to spend $2.3bn on football sponsorships. This includes massive unspecified investments to buy majority stakes in four Saudi Arabian football teams. The four clubs have spent lavishly to attract players from around the world, particularly Al-Nassr, which signed star player Cristiano Ronaldo for a reported $200m annually, making him the world’s highest paid athlete.
Ronaldo’s signing last season has been followed by a host of stars and coaches including Karim Benzema from Real Madrid, N’Golo Kanté from Chelsea, Roberto Firmino from Liverpool, and the former Aston Villa manager Steven Gerrard.
The footballer Lionel Messi is reportedly paid an estimated $25m by the Saudi Arabian tourism authority for his promotion of the country, including posting about lavish trips on social media. He received an offer from Al Hilal of £350m but instead opted for the US MLS team Inter Miami.
In February this year, Saudi Arabia announced it would host the 2023 Fifa Club World Cup.
The PIF has also made major investments that have upended golf, and now make Saudi Arabia perhaps the most influential force in the sport. In October 2021, the fund invested an estimated $2bn to create LIV golf, a major tournament.
The move set off a bitter rivalry with the PGA tour, which took legal action claiming that the Saudi-funded project was luring players to breach their existing commitments. One lawsuit accused LIV of a campaign to use “astronomical sums of money … in an effort to use the LIV players and the game of golf to sportswash the recent history of Saudi atrocities and to further the Saudi Public Investment Fund’s … initiatives”.
The feud ended in dramatic fashion with an effective takeover of the PGA to create a conglomerate to dominate professional golf. The governor of PIF, Yasir al-Rumayyan, is slated to be the chair.
A PGA executive told the US Congress this month that the sovereign wealth fund would invest “north of $1bn” in the new body. The deal is being investigated by a US Senate committee.
Some of the kingdom’s other investments include boxing and motor sports. This year, YouTuber-turned-boxer Jake Paul fought Tommy Fury in Riyadh for payments of $3.2m and $2m respectively, plus a share of the pay-per-view revenue. The kingdom also paid an estimated $60m to host a heavyweight match between Oleksandr Usyk and Anthony Joshua in 2022.
In 2021, PIF invested in a $550m sponsorship of McLaren Group Ltd, a Bahraini-owned company based in Woking which is a major part of Formula One through its manufacture of racing cars. The $6.3bn figure, however, does not include the $40-45m which state-owned oil giant Aramco spends annually to sponsor Formula One, or other contracts signed prior to 2021 such as $65m to hold an annual Grand Prix in the kingdom.
The total also excludes the PIF’s extensive spending in the world of e-sports, including a recent $1bn investment in video game company Embracer Group, and sporting events where the sponsorship amount is unknown, such as a March 2021 four-year deal between the planned city of Neom on the Red Sea coast and the Asian Football Confederation.