Football as a Strategy for National Prosperity: The Saudi PIF Example

It is common knowledge that if the people are happy, the nation will be at peace. Such is the capacity which sports possess.’’

Gen. Yakubu Gowon, (1934-)Nigerian Head of State, 1966-75

 The Saudi Arabian Football League, now known as #RoshnSaudiLeague as a result of some huge capital investments it recently attracted, has risen to probably compete with the World’s 5(England, France, Italy, Germany, and Spain) major football leagues in terms of capital investments and content capabilities. It’s an outcome of the investment by the Saudi Arabian Public Investment Fund which in June 2022 took equity control over four of the country's top football teams - Al-Ittihad, Al-Nassr, Al-Hilal and Al-Ahli – as part of the country’s Vision2030 plan. Under it, football plays an integral part in the kingdom’s aim to diversify its economy, boost tourism, and create an atmosphere of investments to strengthen national prosperity and enhance global appeal.

THE SAUDI ARABIAN PUBLIC INVESTMENT FUND

This institution is a deliberate creation of the Kingdom of Saudi Arabia to pursue its national development through the diversification of its economy into diverse sectors. It was founded in 1971 as its Sovereign Wealth Fund Initiative and re-modeled in 2015. The fund is managed by a Board but under the direct guidance of Crown Prince Mohammed Bin Salman, the facto ruler of Saudi Arabia.

The PIF has an ultimate goal to become a global investment leader through the delivery of large-scale investment and infrastructure projects that would shape the global economy.

AN ABRIDGED PROFILE OF THE SAUDI PIF

92 Portfolio companies created

13 Strategic sectors

560,000 + Jobs created

$700BN + Assets Under Management

THE SAUDI ARABIAN ROSHAN LEAGUE

In June 2022, the Saudi PIF bought 75% investment rights over four of its major football clubs as earlier highlighted, and thus prompted the drive to attract the best quality of world footballers to strengthen her local league.

The major bang in their investment was the coming of Portuguese captain, Cristiano Ronaldo, one of the world’s most decorated active footballers, in January 2023. Thereafter, others followed and by the end of the summer 2023 transfer window, about $900m had been spent on players transfer by the 14 teams in the SaudiRoshanLeague! According to Transfermarket, one of the world’s most authoritative football websites on players’ activities, the RoshanLeague, ranked second, apart from the English Premier League, in player transfers.

In terms of individual spending by football clubs, three out of the ten biggest spenders in the August 2023 transfer window, are from within the SaudiRoshanLeague. Hitherto, it was not so!

Other consequences of this strategic plan include,

·        Signed broadcast deals globally with leading media houses like DAZN, Canal+, etc. to make the league available in 130+ countries

 

·        Brought a boost to local manufacturers and businesses by signing 116+ sponsorship deals across the 18 teams

·        Same for the kits, 18 teams have partnered with 12 kit manufacturers including #Nike #Puma #Adidas and many local manufacturers like Offside

Whilst justifying this move, His Excellency, Yasir Al-Rumayyan, the Governor of the PIF, highlighted the need to meet the interest in sports for the 63% of Saudis who are under the age of 30.

"You will have a lot of young people who are interested in sports and entertainment and that's basically part of the offering."

He further reiterated the huge expenditure as a deliberate investment targeted towards sustainability for the enterprise

"It makes financial sense to us, and that's the only way going forward. We don't like to subsidize things … we would like to have it sustainable."

Whilst most pessimists would doubt the sustainability of this project, seeing the income generated, it is expected that its drivers would have studied the factors that caused the demise of the Chinese League (it was a similar initiative) and the teething problems faced by the English Premier League before its stability. Overall, using sports as a basis to strengthen national prosperity and peace would also remain a success, as highlighted in the introductory statement of this article.