The Financial Times revealed in a new report that Saudi Arabia’s Public Investment Fund (PIF), which manages more than $600 billion in assets, had entered partnerships with several soccer clubs ‘amounting to SAR8.75 billion [US$2.3 billion]’ during the first eight months of 2022.
According to the report, most of the investment comes from 20-year commercial deals that PIF-owned companies Qiddiya and Jeddah Central have with some domestic soccer teams, including Al-Nassr and Al-Hilal. Real estate development company Roshn, which is also part of PIF’s portfolio, also recently signed a five-year contract to title sponsor the Saudi Pro League, the country’s top-flight soccer competition.
The spending spree on soccer was revealed in accounts that PIF shared with buyers in a $2bn bond it raised earlier this week.
The accounts also show that the sovereign wealth fund received a qualified opinion from KPMG for its 2021 financial statements last August, which implies the audit agency couldn’t get comfy with sure elements of the accounting.
In an audit letter dated August 2022, KPMG flagged that it was “unable to obtain sufficient appropriate audit evidence” round transactions with PIF’s board administrators and their relations.
However, the PIF declined to comment when asked by the British paper.
The report pointed out that PIF’s most high-profile soccer investment to date was its controversial takeover of English top-flight club Newcastle United. Since acquiring the team for around UK£300 million (US$331.2 million), the owners have spent more than UK£200 million (US$220.8 million) on new players, as well as appointing a new head coach and chief executive for the Premier League team.
Noon, a web-based retailer based mostly within the Gulf and backed by PIF, turned one of many group’s shirt sponsors in June this yr. The firm additionally has a business partnership with Manchester City, which is owned by a member of Abu Dhabi’s royal household.
The report expected that Saudi ambitions in soccer are set to develop additional, pointing out to Crown Prince Mohammed bin Salman’s participation in a boxing match in Jeddah with Gianni Infantino, secretary-general of Fifa.
Saudi Sportswashing policy
Sportico website earlier revealed that the oil-rich nation has spent approximately $2.2 billion since 2017 aiming to rebrand itself as the Middle East’s newest sports and tourism hub—an effort known as Vision 2030 that is receiving harsh scrutiny from human-rights advocates and forcing some in the sports world to make hard choices.
Sportico went on saying that Saudi authorities want “to reposition KSA as a tourism and leisure hub to pivot the economy away from oil. But tourism and torture don’t mix.”
Saudi public debts rise
The Saudi public debt has notably increased over the past years since MBS came to power. In 2017, the public debt was $118.2 billion, including $49 billion external public debt.
In 2018, the public debt increased to reach $149.3 billion, including $68 billion external public debt.
The public debt reached $180.8 billion in 2019, including $81.4 billion external public debt, and $227.6 billion in 2020, including 93.6 billion external public debt
In 2021, the public debt reached $250.7 billion, including $101.1 billion external public debt, while the public debt reached $255.6 billion, including $101.1 billion external public debt.
Public anger is growing
Growing anger has been reported among Saudi social media activists over MBS’ economic plans declared since he took office in 2017, holding him responsible for the deteriorating economic situation despite the high oil prices.
