Saudi Arabia’s Investments Raise Questions of ‘Sportswashing’

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Saudi Arabia’s Investments Raise Questions of ‘Sportswashing’

Saudi Arabia has made unprecedented investments in international sports. Critics accuse the kingdom of “sportswashing” its reputation for human rights abuses.

Saudi Arabia has rapidly become a global player in international sports, spending billions of dollars in recent years on several high-profile deals across the industry. Saudi officials say these government investments are part of a plan to diversify the country’s petroleum-based economy, but skeptics allege that Riyadh intends to use sports to enhance its prestige and cleanse its poor human rights record. Meanwhile, other Arab Gulf states are also ratcheting up their sports investments.

What investments has Saudi Arabia made?

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The kingdom’s first major investment in a foreign sports enterprise came in 2018, when the Saudi sports ministry signed a ten-year contract to host World Wrestling Entertainment (WWE) events, a deal worth a reported $100 million per year (about 10 percent of WWE’s annual revenue). Since then, Saudi Arabia has spent lavishly to host boxing, tennis, horse racing, and Formula 1 events. It has also financed international golf competitions and bought stakes in a Formula 1 franchise and an English soccer team, the latter purchase reflecting investment in the country’s most popular sport. 

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The kingdom has managed recent investments through its $650 billion Public Investment Fund (PIF)—the world’s fifth-largest sovereign wealth fund. These include purchases of Newcastle United, a soccer team in England’s top-level professional league; LIV Golf, an international rival-turned-partner to the U.S-based PGA Tour, golf’s foremost competitive body; and four teams in the Saudi soccer league, which has recruited a handful of global stars with extraordinarily lucrative contracts.

Why is Saudi Arabia investing in sports?

Saudi officials say that sports investments are part of Vision 2030, a broad government plan to diversify the country’s economy beyond oil. (Another controversial investment sector is technology.) They assert that sports investments will help boost foreign investment, increase domestic employment, spur tourism to Saudi Arabia, and encourage fitness in a country that struggles with obesity. Indeed, sports’ contribution to Saudi Arabia’s gross domestic product (GDP) almost tripled between 2016 and 2019, prior to many of the country’s more high-profile investments. 

Cristiano Ronaldo extends his phone to take a selfie upon arrival in Saudi Arabia.
Cristiano Ronaldo takes a selfie after signing with Saudi soccer team al-Nassr. Ahmed Yosri/Reuters

But other observers view sports investments as a way for the Saudi monarchy to “sportswash” away criticisms of its domestic and foreign policies, especially with regard to human rights. The country ramped up its sports investments after the assassination of Saudi journalist and U.S. resident Jamal Khashoggi in 2018, a crime that drew international condemnation and Western sanctions after the U.S. intelligence community found that Saudi Crown Prince Mohammed bin Salman likely approved the operation. The Saudi government denied bin Salman’s involvement, instead pinning the blame on rogue government agents.

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Regardless of its motives, the country’s sports investments could have significant international implications: with a larger and more diversified economy, Saudi Arabia could chart a more independent foreign policy while enhancing its international image by tying it to recognizable cultural products. 

“There’s something to the fact that Saudi Arabia wants to be known for something other than oil, religious extremism, and the past in which women couldn’t drive,” says CFR Senior Fellow for Middle East and Africa Studies Steven A. Cook. “That’s, of course, part of what is driving the Saudi investment in sports. But, again, it's also part of a broader strategic move that is articulated in Vision 2030.”

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How has the United States responded?

The kingdom’s foray into golf has drawn extensive media coverage and heightened scrutiny among U.S. lawmakers who warn that it could normalize Saudi Arabia’s human rights abuses.

The PGA Tour and LIV Golf (via its parent, the PIF) announced their intent to partner in June 2023. Days after, two U.S. senators and the Department of Justice (DOJ), respectively, opened investigations into the agreement. At the first senate panel investigating the arrangement, Senator Richard Blumenthal (D-CT), who is leading the probe, said the hearing was “about how a brutal, repressive regime can buy influence—indeed even take over—a cherished American institution simply to cleanse its public image.” A bipartisan group of lawmakers has expressed concern over the agreement, though some think it should be scrutinized by federal regulators before lawmakers investigate.

Meanwhile, the DOJ investigation could scotch the agreement if regulators find it violates antitrust law. The investment in the PGA Tour by a foreign entity could also make the agreement subject to federal review for potential national security risks, though experts view these as unlikely. Under the proposed framework, the governor of the PIF will serve as the combined organization’s chairman, and bin Salman, who chairs the PIF, will exert financial influence over one of sports’ top bodies.

Are other countries sportswashing?

Sports have long been popular vehicles for governments, including authoritarian regimes, to showcase their countries’ economic and cultural assets to a global audience. China hosted the 2008 and 2022 Olympics amid accusations of genocide, and Russia annexed Crimea weeks after hosting the 2014 Olympics. Critics, including international human rights groups, accused both states of sportswashing.

In the past decade, smaller Gulf states have also made hefty sports investments that have drawn controversy. The Emirati and Qatari royal families have bought professional soccer teams, and Qatar hosted the FIFA World Cup in 2022. Experts said the event fueled Doha’s global ambitions, even as it drew attention to the government’s widespread abuses of the migrant workers who built its stadiums. These countries “are making their kingdoms central to global discussions about sporting, tourism, trade, and education—not by building vast militaries, but through increasingly savvy cultural and financial forays far beyond their borders,” writes Sean L. Yom, a senior fellow at the Foreign Policy Research Institute.  

Are more investments coming?

Western governments have few tools to block foreign investments when they are made through legal channels, unless they present risks to national security. So in most cases, international investors are free to buy into as many sports franchises as the market allows. Some U.S. sports leagues have actively sought out such investments: in November 2022, the National Basketball Association (NBA) changed its rules to allow ownership by sovereign wealth funds. Less than a year later, and the same month of the PGA-LIV merger announcement, Qatar’s investment authority reached a deal to buy 5 percent of the parent company of the NBA’s Washington Wizards. The lack of regulatory scrutiny over the purchase signals that U.S. efforts to rein in Saudi Arabia’s investments are unlikely to succeed, CFR’s Cook says.

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