Why Saudi Arabia Pours Billions Into Sport Stars (And It Makes Sense)

Sometimes as economists we need to analyse complex decisions to understand what the outcomes might be. On the more baffling end of the scale we have Saudi Arabia spending billions on football, golf and Formula 1 stars who are mostly a little past their prime to come and play in the largely unknown Saudi leagues. Is this simply sports-washing (a PR stunt) or is there something more clever going on?

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[ekmalsukarno]

Economics Explained, can you please make a video on the Sultan of Brunei, his oil wealth and how his economic policies impact Brunei's economy and the Bruneian citizenry. Thank you very much.

[JoelReid]

Just a clarifier: Australia and New Zealand broke even in 2023 with the Women's world cup, and was applauded for being the first to do so. Considering this was over a very large area covering over 5000km in distance between Perth and Wellington, This is very impressive.
So these are not always losses, at least not as of releasing this video.

[abdulrahmanissa]

It really showed that you do not follow any of these sports. You mentioned "that it doesn't really matter" but I think it does. Creating a competitive league in football which attracts viewerships from around the world is one of the hardest things to do, it doesn't just come from throwing money at the best players in the world but by allowing fans to have an emotional connection to the club they support. Emirati backed Manchester City, who have been the most successful club in England for the last 13 years are often ridiculed for their lack of supporters despite being the richest and most successful club in England. English clubs have gradually been waiting for over 140 years to get where it has, Saudi cannot do so in a few years. It's for that reason that this investment will most likely fail.

[missema]

It is clear how Saudi Arabia has changed its policy and shifts to investing in many sectors, including sport. The results may take time, but eventually, there will be drastic changes.

[hogoselva]

Why do you say Saudi Arabia doesn’t have a history in sport?!! We and Japan and South Korea dominated Asian football for decades every single person in Saudi Arabia watch football, local leagues and European leagues also and football is our only sport. We don’t have another sport everybody crazy about football here.

[dlewis]

I had no idea that France has such a robust sovereign wealth fund. I sort of assumed the state finances were precarious since France always seems like a country that was wealthy in the past but not the present.

[pantlesJon]

It might be a good idea to make a side video on Saudi Arabia's contribution to e-sports as well. They have spent billions of dollars in that market as well. They even built an entire city dedicated to it.

[Mark-vnet]

Can you make a video of the actual probability that the gulf states have being distanced from oil? It seems highly unlikely to me they can keep up with what they are doing with other industries once the oil revenue dries up

[AboSaad-qn]

Saudi Arabia has no history in sports??!!!! Saudi clubs are the most established in the Asian champions league and have won the most Asian champions leagues, even more than the Japanese clubs. additionally, Saudi Arabia have won the AFC Asian Cup three times.

Furthermore, the Saudi people are very enthusiastic about football and support their league and the traditions of the clubs is there looong before all the money showed up.

Its just that these FACTS does not work with the narrative that everyone wants to talk about,

[mambofornasa]

Call it sports-washing or whatever, but football holds my heart. I am a new supporter of the Saudi League and yes it will act as a catalyst of how to speed up economic influence.

[MartinNew]

Saudi Arabia aims to diversify its economy, but faces challenges due to issues related to confidence and its religious governance. Additionally, it is making efforts to enter the world of sports by recruiting foreign athletes to enhance its image, but success might be hindered by its confidence-related obstacles

[EverettBurger]

It's not just athletes "past their prime".

Usyk, Fury, Ngannou, etc. are in their primes.

[Saracen]

“The problem is that people know too much about Saudi Arabia” smh, Saudi is literally the most misunderstood counrtry in the world.

[davidbowie]

The Saudis have their goals: diversifying the economy. The government has involved heavily on it as football is Saudi Arabia's most popular sport. This made them greatly different from China, when Chinese government pressured investors to develop football as part of a general strategy to become a soft power giant (given football has long struggled to gain popularity in the country).

However, if this strategy also includes the development of soft power, then Saudi Arabia is years behind.

[GreyWasteTim]

A country that bans alcohol and alcohol sales probably not gonna do well with sports fans.

[Cooe.]

0:42 Except for Salt Lake City 2002!!! Not only did SLC ACTUALLY MAKE MONEY on the Olympics (thanks Mitt Romney), but the area infrastructure upgrades were absolutely CRITICAL to the area's massive tech boom over the past ≈10-15 years! And even the winter sports infrastructure that was built all still gets used as well as the national base for the US Ski & Snowboard Teams among others.

[orthodox-mphv]

"I have very little insights who the best football or stickball or zoomie man is." Lol! That was a good line.

[haydencrawford]

It's just the "bread and circuses" style of economics. Distract the masses with games, events, and generous public spending to hide the fact that the country is silently crumbling.

[economicboardgames]

I always love how even the advert, today, being about shaving products, integrates learnings of some sorts. Nice vid as usual. A lot of combat sports are also showcasing main events to this region as well, another impact on California as per your last video, casino and hospitality impact.

[EnzosBenzo]

If the Saudi’s own the teams then they own the streaming rights to broadcast those teams’ games. Perhaps in a less physically globalized world streaming would allow people to watch their favorite players from the comfort of their own, western home. Plus it puts pressure on the already existing leads to propose a merge e.g. liv golf