Held over a barrel
A guest post about the rise and unchecked rise of Middle East money in sport, PLUS: Midweek Book Club
The intersection between Middle East oil money and the sports-entertainment complex might seem like a modern phenomenon but it’s not - the influence of the region can be traced back to the 1970s.
There’s no more stand-out candidate for the zeitgeist of world sport at the moment than the blank-cheque approach from the Kingdom of Saudi Arabia to sign the best of the world’s male (note that) sports talent.
This is being done under the guise of what the NZ Herald this week reported as “efforts by Saudi Crown Prince Mohammed bin Salman to leverage the kingdom’s oil wealth to provide new jobs and opportunities for Saudi Arabia’s youth”.
This was laid bare in recent days with an offer from Government-funded Saudi club team, Al-Hilal, to sign French football genius Kylian Mbappe from Paris Saint-Germain for a world-record €300 million - more than half a billion NZ dollars.
Critics would say it’s sportswashing. The claim that you’re developing youth by spending an outrageous sum on one football player is pretty porous.
Buying into the global sports market is in no way a sudden new turn in direction for the region.
It’s a journey which began with the election of a Brazilian official to the presidency of Fifa in the mid-’70s, coupled with the world oil crisis later that decade, but we’ll get to that.
First, a question: is it fair that Middle East nations, Saudi Arabia mostly, cop nearly all the blame for escalating the wealth in sport?
When we direct opprobrium and indignation at the Saudis for contaminating the soul of sport and its operations, aren’t we just shooting the messenger?
If you want to apportion blame for being sucked into the sporting money trap, it’s those taking the money that are mainly the catalysts for transformation - as far as we know no-one has been held over a barrel to accept even a cent.
The LIV golfers and the like are selling their principles to the highest bidder; selling their principles in lieu of some pretty glaring abuses of human rights, particularly regarding women. It’s a reasonable assumption that the subject of human rights could conveniently be buried back of mind, especially when one isn’t the recipient of the abuse, haven’t seen it first-hand or justify it by saying, “It happens everywhere - even in my own country.”
If it’s down to a contest between those factors and setting yourself up for life, many are going to cave in.
The whole issue is ethically haywire, but keep in mind that the world of professional sport can feel daft and unreal. It is full of avarice. It’s nothing new.
To unravel how some particular nations and individuals of the Middle East have used their phenomenal wealth in the past decade especially to create or secure events such as LIV golf, the Fifa Men’s World Cup, Formula One Grand Prix and the world’s richest horse race, one has to travel back in time to 1974 and the ascension to the Fifa presidency of a highly successful businessman from Rio de Janeiro, Joao Havelange.
When Havelange took over there wasn’t much capital in the Fifa coffers. One of his favourite utterances was that when he arrived he found $20 in the till and headquarters that were falling apart.
Havelange’s radical agenda included expanding the men’s World Cup finals tournament from 16 teams to 24, and a pledge to bring Fifa age-group tournaments to parts of the world that hadn’t staged international football events.
Havelange’s election also coincided with a boom in sports marketing and advertising partly owing to the ever-growing popularity of colour television. It helped that Havelange had built a friendship with Horst Dassler, the son of Adi Dassler - the founder of Adidas. It helped also that Joao and Horst both loved sport, but adored money even more.
Nations of the Middle East began to see football as a ticket to greater global prominence, however the national football associations realised they needed outside coaching expertise to get their teams to a competitive world standard.
In 1977, England’s national football coach Don Revie, of Leeds United fame, resigned his post to take over as manager of the United Arab Emirates national team. The contract was for £350,000 pounds over four years. Nobody entertained the notion such a thing could happen - certainly not involving England’s manager.
There was another circumstance though, which did more than anything to accelerate the rise of the Middle East delving into the financial world of professional sport.
Amid the world oil crisis of the 1970s, which led to a law in New Zealand, commonly referred to as “carless days”, Dubai’s ruler, Sheikh Al-Marktoum, came to understand that the emirate - one of seven that make up the UAE - needed to diversify its economy. He and his son Sheikh Mohammed had been advised that Dubai may have only 20 years of oil reserves left.
The sheikhs decided that one of the tenets of their new economy would be wealth-driven sports and tourism. There was sufficient stored wealth to build top facilities for tourism and sport to be able to attract investors and funding from banks.
The first effect of this huge shift in focus was to annoy its wealthier neighbouring emirate, Abu Dhabi, the UAE’s capital, by luring away some of its business and investment. Despite this, the strategy was successful - all’s fair in love and war.
Through the 1980s, Dubai was transformed from a desert outpost into a financial powerhouse and international destination. Multi-lane highways were rapidly built and a re-configured airport was expanded to house the world’s largest duty-free shop. Dubai’s accessibility increased sharply with the launch of Emirates Airlines in 1985.
In terms of sport, golf was an initial target for Al-Marktoum and his son, as much for the fact that Dubai’s name would be prominent on TV screens for longer than other sports. The rulers also figured that attracting a golf crowd would be good for business. Landscapers were ordered to excavate sand for green grass and golf courses.
The tourists started to arrive.
Football, however, was the sport that nations of the region knew could open things up beyond compare. Mihir Bose, in The Spirit of the Game: How sport made the modern world, recounts that Middle East specialists, particularly at the British Foreign Office, viewed sport, and football in particular, as a way to advance their political and business agenda.
This led to a hitherto unheard of arrangement whereby sporting contacts would be established with Saudi Arabia in exchange for a range of military and arms-supply contracts to be awarded to British Aerospace (BAE). This was all done with the approval of Margaret Thatcher’s Conservative government.
One outcome of this dubious deal was that in 1988, the England football team and reporters were packed on to a Concorde to fly to Saudi Arabia for the first of two friendly matches, one in each country. Reportedly, when the players were welcomed aboard for the flight to Riyadh they were greeted by the beaming face of the CEO of British Aerospace. The reporters on the plane were apparently as confused as the players. Bose writes: “The reporters present did not realise they were seeing the willing collusion of English football authorities in the arms trade.”
The football marketplace was further opened up when Fifa (still under Havelange’s reign), decreed that Saudi Arabia would host the first three editions of the Confederations Cup, which began in 1992.
There is a continuing desire in the Middle East for more global sporting prominence and it stands to reason as a part of an economic Plan B for when oil reserves either get too low or become increasingly obsolete in a climate-conscious world.
Qatar winning hosting rights for the Fifa World Cup in 2022, is evidence of sport being seen as part of a much wider strategy of pursuance of economic, social and political goals. As with Dubai, it’s also about using sport as a gateway to being a major business and tourist market.
In an article titled, “Why Qatar is hosting the World Cup and what it hopes to achieve with it,” the Brussels Times is unequivocal about these motivations.
“The country aims to grow its non-energy economy, with ambitions to become a regional business and tourism hub. Hosting the World Cup is a step on the way to realising these ambitions, as the infrastructure developed… was designed to strengthen transport connectivity and grow the local business environment.”
Saudi Arabia is probably even more zealous in its pursuit of wealth and recognition in the global sports market and has at hand the huge Public Investment Fund. Beginning as far back as 1971, PIF is a sovereign wealth fund, which funnels loans to the Saudi economy and is directed towards aspirational national wealth and global business.
Other nations also have sovereign wealth funds1 . In many cases the capital is gleaned from natural resources and in the case of Saudi Arabia’s PIF, the fifth-largest fund in the world (estimated at US$1 trillion), that’s oil.
PIF has more than $620b annually at its disposal. By 2030, the fund is reportedly expected to grow to a mindboggling $2t. It all feels rather unreal2.
PIF invests $40b annually into airlines, defence and high-tech firms, entertainment enterprises, even coffee farms3. In fact, if you were to visit Saudi Arabia, it may be impossible to find a business that isn’t linked to PIF.
Obviously, the royal rulers (government) figured there was still plenty remaining of this sovereign fund to invest into sport, hence the sudden appearance of an initiative like the LIV golf tour, its avalanche of prizemoney and the commandeering of Greg Norman to lead it. (God forbid that they were attracted by the Great White Shark’s selfies on his social media.)
No wonder PGA tour officials including chief executive Jay Monahan could see the writing on the wall. Someone probably tipped them the wink on the amount that Crown Prince Mohammed bin Salman and his officials had earmarked for their PIF fund by 2030.
Who among us wouldn’t then think, “If you can’t beat them, join them”?
Money rules business. And professional sport is business. Very big, and very strategic business in the 21st century, a point it has been leading to since the mid-’70s.
The Middle East will continue to be a huge part of that.
Paul can be found on Twitter: @pm_spotter
Title: The Art of Centuries
Author: Steve James
Publisher: Bantam Press (2015)
Genre: Anecdotal (niche) reporting
Reviewer: Peter Hansen
“Working out how to score centuries regularly is an art,” writes Steve James in this gem of a book.
James should know. A Glamorgan stalwart in the County Championship from 1985-2003, he scored 47 first-class centuries.
Scoring a century is special. The game pauses briefly to acknowledge the achievement. “You rarely see mid-match generosity from the opposition in any other sport,” James writes.
Don’t expect to find modern day greats Virat Kohli, Steve Smith, Joe Root and Kane Williamson quoted and analysed. Rather, it’s outstanding cricketers (Sachin Tendulkar, Graham Gooch and Brian Lara among others) from the recent past, and from further back, Ken ‘Book in for bed and breakfast’ Barrington, Phil Mead and the grand old man WG Grace.
Inevitably there is Don Bradman. Of Bradman’s 117 first-class centuries only eight were in a losing cause. So, as James’ father repeated many times: “If you score a hundred then it is more likely that the team will have a decent score.”
Initially anatidaephobia (the fear that somewhere, somehow a duck is always watching you) has to be overcome. The chapter Fear of the Duck illuminates this with anecdotes and tales of horrendous encounters of sequences of ducks like Sri Lankan opener Marvan Atapattu’s 0, 0, 0, 1, 0, 0 at the beginning of his test career.
Subsequent chapters cover Preparation, Luck, Superstition, Love and Hate (“I used to hate getting out; I’d mope and sulk for hours,” says Glenn Turner), Technique and Conversion.
Provocatively James regards T20 and one-day centuries as lesser achievements. He details “Daddy Hundreds”, like Dean Jones’ epic 210 against India when Steve Waugh described Jones as a “walking corpse.”
The “Nervous Nineties” are traversed as are the greatest centuries various well-known cricketers have witnessed.
Throughout James writes with empathy, affection, humour and an eye for the esoteric anecdote.
There are enough stats to satisfy the stats lover and plenty of diverting journeys along cricket’s many wonderful byways.
There’s advice aplenty to help anyone score a hundred and, if you’ve been fortunate enough to score one, make you wonder how you managed to do it
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New Zealand’s Superannuation Fund is the 24th largest sovereign wealth fund in the world by value
To understand the scale of Middle Eastern oil wealth, four of the largest sovereign wealth funds in the world emanate from the region: UAE (est. $1.7t), Saudi Arabia ($1t), Kuwait ($712b) and Qatar ($445b).
PIF has taken ownership control of four soccer clubs in the Saudi Pro League -Al-Ittihad, Al-Nassr, Al-Hilal, and Al-Ahli - as part of the Kingdom’s Sports Clubs Investment and Privatisation Project.
Yep, great article.
Perhaps we could prevail upon the esteemed Crown Prince to donate a few $billion to NZ annually to keep our fuel costs down. ?
Great article. Thank you Paul