Podcast: How Gulf money is reshaping sports
A conversation with the incomparable James M. Dorsey, founder of The Turbulent World.
In recent years, the world of sports has witnessed a seismic shift, one fueled by a seemingly endless influx of Gulf money. The United Arab Emirates transformed Manchester City into arguably the most dominant football club in the world; Qatar hosted the 2022 World Cup—the first of its kind in the Middle East—and is in the process of negotiating a takeover of Manchester United. Meanwhile, Saudi Arabia is in the midst of an unprecedented wave of sports investments aimed at transforming the kingdom into a global hub.
These moves, driven by a combination of economic diversification strategies and the desire for international recognition and legitimacy, have thrust the Gulf states into the global sports spotlight.
I had the pleasure of appearing onto discuss these ongoing developments. We attempted to answer questions such as: why are Gulf States willing to invest huge amounts in sports? Will Gulf money change sports like football? Should states be allowed to control sports clubs or are they vital parts of civil society that should be shielded from encroachment by the state?
Dr. James M. Dorsey is an award-winning journalist and scholar who happens to be one of the most knowledgable people on this subject matter. This is an opportunity you won't want to pass up.
You can listen to the entire hour-long discussion below:
A portion of the transcript is available below:
James M. Dorsey (02:48):
You just landed in Cairo. What has changed?
Karim Zidan (02:57):
Well, right now it's just the exceptional heat here in Cairo. But there's definitely a feeling in the air here that people aren't as comfortable with pretty much anything anymore right now when it comes to Cairo. There's so much of a debt crisis here. You can tell with the prices of everything, inflation has gone up dramatically. I come to Egypt twice a year or so, and every time I've come here recently I've seen the increase in prices. I'm seeing the valuation of the currency change, seeing people's lives and situations go from bad to worse, and at the same time, their willingness to even stay quiet about these certain topics as well has disappeared. You're much more likely to hear about the discontent that people are feeling much more openly in the streets. Well, just a few years ago, people were sort of whispering a bit more or actually still feeling a lot more positive about the government, so that's a significant change that's happened here and I mean we can tie Egypt back into everything we're seeing in the Gulf as well because we see (Egyptian President) Abdul Fatah (al-Sisi) is going regularly trying to solicit donations and funds from various countries, and a lot of that is to sort of stem the tension and the tide that's taking place here in Egypt right now to sort of fix the economic crisis that the country's facing. So it's an interesting time and things are regularly changing here.
James M. Dorsey (04:27):
That leads me into something I really wanted to raise with you, but before I do that, just one comment. One of the things that struck me actually this week was that countries like the UAE and Saudi Arabia had essentially told the Egyptians, “We're no longer going to pour money into a black hole. If you want aid, you need to start reforming your economy in line with what the International Monetary Fund requires.” And yet the UAE this month agreed to fund Egyptian wheat purchases. Egypt is one of the largest wheat importers in the world to the tune of $500 million over the next five years, and there were no conditions of economic reform attached to that, which leads me into the whole issue of the role of sports and particularly soccer in the last century in the development of the Middle East. This month was the 10th anniversary of the Rabaa Square massacre in Cairo when some 800 protestors opposed to the military coup in Egypt a month earlier were killed.
Many of them were affiliated with the Muslim Brotherhood. The coup toppled Egypt's first and only democratically elected president, Muhammad Morsi, a member of the Brotherhood. The massacre signalled the end of an era in which militant football fans played a key role in Middle Eastern protests like in the 2011 popular Arab uprisings. It strikes me that the role of fans is in suspension and could at any moment reemerge as we see new protests in Bahrain and Syria erupt. Yet, we're also seeing with the Gulf splurge on sports a shift from the grassroots politics of sports to an elite takeover. What do you think?
Karim Zidan (06:24):
I think you raised some very, very interesting points there. To speak of it from an Egyptian perspective, I have friends and family even who have been members of the Ultras in Egypt, which is the sort of hardcore football fan groups that were so prevalent during the revolution and were shortly snuffed out thereafter by the Egyptian government and turned into now a terrorist organisation. Not that they are terrorists, but they're referred to by the government as a terrorist organisation and attempt to keep them disbanded. That's how much the Egyptian government fears the strength and capabilities of the youth gathering in a non-politicised force. That's the thing that the government absolutely fears. It's the reason to this day that our stadiums aren't full regularly during the Egyptian Football League, even though the Egyptian Football Federation and the various major clubs here in Egypt have been lobbying to restore it and the Egyptian government still to this day, despite we are now more than 10 years past the revolution,
James M. Dorsey (07:30):
Let me just interrupt you just for everybody. Basically, Egypt closed its stadiums on the 25th of January, 2011 when the popular Arab revolt broke out that finally in February toppled Egyptian President Hosni Mubarak, and as Karim was just saying, they have never fully reopened. Sorry to interrupt you, Karim.
Karim Zidan (07:54):
No, by all means, I should have noted that myself, but the truth is, the Egyptian state still fears the gatherings of young Egyptian men in such force and in such masses. They know what they've been capable of in the past and they really don't want to see a repeat of that despite the strength of the military at this point. This leads us definitely into what's going on in Saudi Arabia. I think, James, because while there are consistently arguments being made that Saudi's push and investment in sports is sports washing as we've discussed in the past, I really think that that's a crude term that doesn't fully encapsulate the entirety of Saudi Arabia's aims. And while we've discussed a lot of them in the past, I think it's worth mentioning some of them includes between reputation laundering and building a global hub for tourism and developing alternative economic sectors.
But one that was rarely discussed is that by really creating this football feeding frenzy that Saudi has taken parts in right now and bringing in this wealth of stars and elevating the top four teams, the Public investment Fund has purchased 75% of majority stake in all the four major teams in the Saudi Pro League and is also slightly funding some other teams as well to bring in all these stars. I think that this is an example of bread and circuses. At the end of the day, this is an distraction for the local Saudi youth. When you think about another Arab country here with a vast majority of its population being young men, the youth in general, most of Saudi's population or significant percentage of Saudi's population is under the age of 35. Distracting them through leisure activities, sports and entertainment is a great way to keep them, I guess, sedated in satisfaction for lack of a different phrase right now. But I think it's something worth considering when we see the contrast here in Egypt. Egypt, because of its lack of resources has much fewer options when it comes to distracting its youth. So as much as it also would love to host a World Cup or more football tournaments, it hosted the African Cup of nations not too long ago, shortly before the Coronavirus pandemic, Egypt does not have the finances to host the type of games and circuses, the levels of entertainment distraction that Saudi Arabia is capable of, and I think that's worth factoring in.
James M. Dorsey (10:13):
Absolutely, and I want to come back to Egypt in a second, but one thing about the Saudi sports blitz, which is really fascinating, is that it's a complete turnaround from what the Saudis were trying to do just a few years ago when they hired a Spanish consultancy to develop the kingdom's first ever national sports plan and that sports plan, one was for men only, and obviously since then Saudi Arabia is encouraging women's sports, but more important to this issue is that the consultants were instructed to focus on individual sports, not on team sports, like football, for the very simple reason that they were afraid of what that could do in terms of bringing people together who may then feel the power of numbers and want to bring all kinds of issues or grievances they may have to the public.
Karim Zidan (11:19):
I mean, there's no doubt about it. I think Saudi Arabia's approach is very clear from the beginning that they had a very different intention. When you think of, I think back to Saudi's initial sports investments, some say from the point when they announced, say Vision 2030 and sports being a major facet of their Vision 2030 expansion plan and finding these alternative economic sectors to depend on rather than oil divestment from oil, I really think Saudi approached it from the perspective of really focusing, as you said, on individual sports. They started hosting individual boxing events and showdowns really focusing on bringing individual athletes. They made a deal with the WWE, which at the end of the day is mainly one-on-one wrestlers competing, and it's about these individual star power that you would bring. They started hosting these motor racing events before they were able to get to the Formula One.
They were hosting sort of lower tier motor racing events. Again, these individual type of sports they made, they attempted to start hosting. People forget now since people are hearing that the ATP and the WTA, which are the associations controlling men and women's tennis are willing to now make a deal with Saudi Arabia. People seem to think that this is a new thing. As a matter of fact, Saudi Arabia has been attempting to host exhibition matches, featuring the world's biggest stars for many years, and they have successfully hosted events with Novak Djokovic in it as well, these exhibitions, but we're not able to get stars like Roger Federer or Raphael Nadal who both decided that it wasn't in their best interest to go play in Saudi Arabia, a decision which now when you really think about it, puts them in the vast minority of what's athletes are willing to do.
I think though, that there was a significant change that happened, James, around 2018, and this is something I intend to write about in my Sports Politika newsletter soon, but I'd like to discuss it and bring it up at least here with you beforehand. Do you remember in late 2017 when one of Mohammed bin Salman's closest confidants…
James M. Dorsey: Let me guess, Turki al-Sheikh
Karim Zidan: Exactly one of his closest confidants. Turki decided that he wanted a piece of Egypt's biggest football club, which is Al Ahli. So in 2017 he gets appointed as the honorary president of Al Ahli/ At this point, Al Ahli is about to head into a presidential election and is lacking funds significantly and needs to make some important structural infrastructural changes. So it is looking for funds at this point. Turki comes in with these big promises, of course, but he immediately oversteps his role, which is symbolic.
At the end of the day, he had no actual power, and what he starts to do is he starts poaching players who were slightly unhappy or questioning their position in Ahli and sending them to the Saudi Pro League, sending them back to the Saudi domestic league. He promised Ahli all sorts of transfers that he didn't end up doing. He promised them a manager that he ended up sending to another team. So really what he was doing was taking advantage of Ahli's name and believing that through his money, he was going to be able to control it. Unfortunately, he didn't factor for how stubborn Egyptian football fans can be, and within a matter of months, the few fans that were even allowed in football stadiums were chanting songs insulting his mother and really, really attacking him. So he got so upset that he ended up, and again, even Ahli's board of directors were at odds with him, so he ended up parting ways with Al Ahli starting up his own rival football club, he bought a club outside of Cairo that had its own fan base, moved it to Cairo, renamed it Pyramids FC, and started throwing massive figures at it, figures that we had never seen before in Africa.
As a matter of fact, he broke the transfer record for an African football team within a matter of months, and this team was immediately elevated to one of the top teams in the Egyptian Premier League. And I mean this story does sound a bit familiar, doesn't it, James? When we think of, for instance, Saudi Arabia's investments in golf, I mean, they had attempted to reach out to the PGA before they started LIV Golf. They just wanted a piece of the pie, and once they felt that they were slighted or insulted, that's when they say, all right, we're going to compete, dump all this money and make life hell for you. And this started with Al-Sheikh. I mean, this was really his approach from back in 2018 and something he did in Egypt. His time in Egypt, just to cut things short here, his time in Egypt wouldn't last.
He'd be out of the country by 2018. I think all his investments disappeared from the country by 2020 in the end. So let's just say his Egyptian experiments failed, but I think the country learned so much in terms of how to approach its investments from then on who to work with and how they can bypass certain barriers that they find in front of them. So I think the mistakes that occurred in Saudi's relationship with Egypt through football were not repeated in the future. Saudi definitely appears to me like a country that is learning from its mistakes and in trial and errors getting better and smarter and more cunning with its sports investments.
James M. Dorsey (16:45):
I think that's absolutely true, and I think it's sort of interesting. I also think there's a broader context here.
Turki has since moved on to be the czar of the Saudi entertainment sector, and he's actually done quite well there, and he hasn't ruffled really feathers. His period of czar of Saudi sports was a train wreckage and Egypt is only one example of it. His relationship with Morocco, particularly in terms of whether he would support the Moroccan bid for the 2026 World Cup and his failed attempt, for example, to establish a federation of South Asian and Middle Eastern football federations, national football federations, which fell apart within month. And so I think one, yes, they clearly have learned from those train wreckages and in some ways Turko Al Sheikh has learned from those wreckages as we're seeing in the entertainment sector. I want to turn to one other aspect or potential comparison if you wish, which is you recently wrote a piece about how Hungarian Prime Minister Victor Orban is exploiting politically the world athletic championships in Budapest that are at the moment ongoing. In other words, the Gulf states are not the only ones harnessing sports for geopolitical purposes, and I'm sort of curious how you would compare what Orban and what the Gulf States are doing.
Karim Zidan (18:27):
Oh, that's a really interesting question. I think much like, here's the truth, I believe that the vast majority of governments would take advantage of major sporting events that come to them. Another example that immediately comes to mind say, we're not even thinking of right-wing governments or conservative governments anymore as these two situations are. Australia, which just host was one of the co-hosts for the Women's World Cup right now, one of the documents that's absolutely available on their government website is a document massive PDF detailing the benefits of sports diplomacy, what they refer to as sports diplomacy and why it is important for Australia's politics and its economy and its general wellbeing that it hosts these major events, the benefits of bilateral relations that come from it, the domestic benefits that come from it, the societal benefits that come from it. Generally, this document could have been perceived as a shady document, but at the end of the day, it's an understanding of governments of the power of sports, how you intend to utilise it is a different story and the context of each government factors in here.
I tend to believe that governments, that all governments should approach it from a narrative of at least some value to human rights. For instance, I think Australia, as much as it promotes its sports diplomacy programme as one that's beneficial to women and one that will grow sports for women, as we're seeing for instance with the Women's World Cup, there's absolutely something to that with the success of the Matildas and the Australian Women's national team and the fervour that caused in the country are probably definitely going to be beneficial for women. But there absolutely has not been a discussion or a reckoning with the lack of Pacific Islanders and indigenous people in Australia and sports in general, and that's something that Australia doesn't want to discuss. So in many ways sports can distract from these major conversations. Australia actually is about to have a vote called the voice in the country debating what the role of indigenous people in parliament and in society.
These are major topics of conversation and sports is actually distracting from this right now in a place like that. So this is something worth considering, the intention that these governments have. Victor Orban, in the article I wrote about him, generally I wrote it not necessarily with criticism in mind or intending to sort of expose anything, but rather because I found it fascinating that Victor Orban saw on event coming like this a prestigious tournament such as the World Athletics Championship, as an opportunity to expand and improve bilateral relations with various countries. It just generally shows that we don't have to be talking about sports washing, but really devious and cunning displays of sports washing as it's referred to. For us to understand that there's an intersection between sports and politics. Victor Orban understands that his position in Hungary is tenuous because of the country's lack of natural gas resources, especially in the wake of the war.
So what does he choose to do? He knows that right now his major allies would be willing to support him are some of his Asian allies and not necessarily his allies in the West or any one part of NATO, which you could tell from the list of leaders that he chose to invite. It surprisingly did not include anyone from Western Europe or from generally the NATO alliance. Instead, he had the Emir of Qatar there. He had Erdogan from Turkey there, presidents of Azerbaijan and Turkmenistan, people who have impressive supplies of natural gas and oil, and immediately within the second or third day of the world athletic championships, he had signed multiple agreements for natural, for natural gas, thereby helping his country. If we just consider that, I think that there is little issue whatsoever with it. This is just generally what the government is going to do and utilise these opportunities, especially when it's displaying itself at a moment of strength, and that's what these events tend to do.
They add prestige to your country, especially when you built new stadiums for it and you're hosting major global events. Well, this is probably the time to have these discussions with your allies while you look good, right? So there's a lot of prestige that comes with sports events. So countries like Saudi Arabia also know this when it comes to Orban and the Gulf, though we have to consider these other factors. Orban has really made some changes in Hungary. He's definitely played the same game that's played in the United States. I actually think when I think of Victor Orban, honestly James, I compare him a lot more to the American right than necessarily the Gulf, which is why I thought your question was very, very interesting. He really is playing up the same type of polarisation of topics such as LGBTQ+ rights in Hungary, abortion rights, women's rights, migrant rights. These are the issues that are plaguing Hungary right now, and Orban is taking advantage of them. The problem is that when he utilises sports events and he's hosting things like football matches in Euro 2020 or taking part in the World Athletic Championships, apart from the fact that these are opportunities for bilateral relations, it's also an opportunity for him to sort of launder his reputation or distract from ongoing issues taking place in Hungary. So that's also worth considering.
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