Saudi Arabia's Huge Financial Investment in Football

As I mentioned in my previous article the major league soccer in North America was always considered the graveyard of talented pro footballers from Europe. The reason behind being all the aging footballers from Europe who are retiring from their professional football career decided to join the MLS league in the past.

That Phenomenon is changing rapidly. The signing of Cristiano Ronaldo to a Saudi league Pro Football club al Nasr had changed the tide completely. Many accused him of going after money leaving the football legacy behind. I don’t think so.

To be honest it is all about money and Saudi pro league is changing the way of doing football business. No other professional football leagues in the world can compete with the amount of money the Saudi clubs can spend on football players. With the influx of quality football players and the relevant footballing legacy and the big injection of money into developing homegrown young talents have helped the optics of football in Saudi Arabia.

The cost of football superstar Cristiano Ronaldo

Ronaldo 's contract was reportedly worth up to 200 million euros per year including commercial agreements. That means the last year’s contract made the then 37-year-old footballer the highest paid footballer in history and the highest paid athlete in the world. Ronaldo 's individual earnings was more than the total staff wage bill for almost half of the clubs in the English Premier League.

It is no secret that the Saudi Football League wanted Ronaldo to boost their footballing optics and to make Saudi Arabia the footballing hub that the world watches.

Messi is joining the Saudi league?

This year, the nation is aiming higher with the potential move of the biggest footballing superstars ever- Lionel Messi and the Real Madrid Superstar Karim Benzema.

It is being speculated that Messi will join a Saudi football club for 2 billion U.S. dollar net wage. That will be the biggest payment to a professional footballer ever in the history of football. Not only that, Benzema who left Real Madrid recently is being linked to another Saudi football club for a reported 200 million U.S. dollar transfer as a free agent.

Sports analysts are arguing that the signing of these footballing super Stars is not an effort to compete with the major European leagues but to enable the country to diversify its commercial appeal beyond the petroleum gas and natural resources.

The football Investment in the superstars is to further economic investments and garner political societal and economic benefits while also whitewashing the human rights abuse. The financial cost to sign individual players is irrelevant when compared to the non-economic benefits the players generate.

The Saudi public investment funds purchased Newcastle United

In late 2021, the Saudi public investment fund bought a Premier League club Newcastle United for 300 million GBP. It was not viewed as quick forward investment but was considered a move to whitewash the poor human rights record of the country. in more than a year after the investment, Newcastle United finished of four in the league and was selected for the Champions league competition for next year.

The investment demonstrated how Saudi Arabia as a nation is investing money across European football to generate benefits and bring positive optics to the governance. the Saudi fund owns 80% of the Newcastle United which is much more than the Saudi ownership of Premier League champions Manchester City and the French champions Paris Saint Germain.

All these investments are quite successful for Saudi investors as they are generating more revenue by selling players and there's an international market to tap onto. Not sure about the financial return on investment for Manchester City and the French champions - PSG, but the non-financial ROI for both gloves is a positive one.

I just watched an interview of Cristiano Ronaldo where he was all praise about the Saudi culture and the footballing future of the Saudi pro league. he was even convincing other players to come and play and suggested that the footballing culture in the country we'll go further and may make the Saudi pro league the top five professional football leagues in the world. that's the exact reason why they signed Ronaldo with that high fee- to talk positively about the nation and the Arab culture.

The signing of these footballing superstars means the viewership and the financial ROI of the Major League Soccer in North America could be in competition. all these players going to Saudi league could mean the North American soccer needs to rely on homegrown talents. that's a positive sign for the North American league but could also mean more financial stress in the coming years.

What is your view? Do you think the investment Saudi is making into these stars a worthy investment?

Posted Using LeoFinance Alpha