Saudi Arabia has splurged billions to boost its sports industry, pouring money into the Saudi Pro League to lure global megastars like Cristiano Ronaldo and Karim Benzema. But can these massive investments truly propel the Kingdom’s economic diversification beyond oil? And how can Saudi ensure this high-stakes sporting pivot pays sustainable dividends?
In a recent interview on the AB Majlis podcast, Partner at Bain & Co. Jürg Kronenberg weighed in on the current state of sports investments in the kingdom and how sustainable it really is.
“Saudi only started doing this two to three years ago,” said Kronenberg, referring to Saudi’s efforts to bring in top talent like Cristiano Ronaldo to the Saudi Pro League. “They probably started a bit later but I think they’re trying to catch up with the UAE.”
He believes Saudi’s Vision 2030 strategy is providing an overarching ambition and roadmap for sectorial development, with sports being one major focus area. The arrival of Ronaldo was “just the beginning” to generate buzz, with Saudi now needing to build an entire ecosystem from coaching to infrastructure.
“What Saudi needs to do is build a sustainable underlying infrastructure and an ecosystem and sector,” Kronenberg explained. “What we’ve seen in a lot of countries, there is a lot of investment and then again nothing happens after it.”
He pointed to South Africa as a case where hosting the 2010 World Cup provided a brief tourism boost but limited long-lasting economic impact. Qatar’s $220-250 billion outlay for the 2022 World Cup – exceeding its annual GDP – demonstrated “a very different scale of investment” compared to Russia spending around 1 percent of GDP.
So can Saudi’s sports-centred strategy pay off? Kronenberg highlighted two keys: grass-roots participation to improve health, and developing ancillary industries beyond top-tier events.
“[The] economic impact of sports is about 50 percent mass participation, and 50 percent is elite sports like broadcasting rights,” he explained.
“Saudi has a unique chance with the World Cup to mobilise the population, mobilise them to be active, to sign up to an amateur club, to play more football in school.”
He is optimistic that Saudi can maintain momentum by creating its own sporting IP and content, rather than just “renting” global events.
“You have a very creative and young population in Saudi, and there is demand for locally created content.”
Upcoming mega-events like the Expo 2030 and 2034 World Cup provide a “double reason” alongside economic diversification to dramatically upgrade infrastructure. But sustained investment in talent development, from referees to coaches, will be vital.
“For me, this was just the beginning,” Kronenberg said of Saudi’s sports push. “I think it was important to put Saudi on the map with that. But there is a shift that will have to happen over time towards investments into underlying infrastructure.”
As Gulf nations like Saudi and the UAE race to anoint themselves global sporting hubs, the multibillion-dollar question remains: can these splashy events catalyse an entire economic reinvention away from oil dependence?
Tune into AB Majlis every Monday
To listen to the full episode and gain a comprehensive understanding of doing business in the Gulf region, visit our RSS feed or check out AB Majlis on Spotify, Apple Podcasts, and other platforms.
Episodes are also available on:
Tune in every Monday for weekly episodes that will help you stay ahead of the curve and enrich your understanding of the Gulf region.
Subscribe to Arabian Business for more exclusive content.
Follow us on
