Saudi Arabia buys increased global soccer status

Saudi Arabia is quickly making inroads into the global soccer market after luring some of the sport's top players away from more prestigious leagues.

Why it matters: Sports are a key pillar in the Saudi kingdom's Vision 2030 program, which seeks to diversify the country's economy away from oil exports.

Driving the news: Paris Saint-Germain star Neymar Jr. became the latest to leave Europe for Saudi Arabia, when Al-Hilal announced a two-year contract with the 31-year-old Tuesday.

• Neymar's contract reportedly could be worth as much as $400 million including commercial deals and other incentives.
• Neymar joins a growing list of soccer stars choosing to play for Saudi clubs, including Cristiano Ronaldo, Karim Benzema — who won the Ballon d'Or last year — N'Golo Kanté, Kalidou Koulibaly, Moussa Dembélé and Riyad Mahrez.

The big picture: The Saudi Pro League has been around for almost 50 years, but Saudi Arabia's Public Investment Fund is seeking to bolster the league's global standing.

• As part of its Sports Clubs Investment and Privatization Project announced in June, the PIF took majority control of four Pro League clubs — Al-Ittihad, Al-Nassr, Al-Hilal, and Al-Ahli — all of which have since spent eye-popping sums of money to attract star players.
• Al-Hilal also tried, unsuccessfully, to sign Neymar's PSG teammates Kylian Mbappe and Lionel Messi.
• The privatization project's goal is to increase the league's revenue from $120 million in 2022 to more than $480 million annually, and increase its market value to $2.1 billion by 2030.

Of note: The PIF became the majority owner of Premier League club Newcastle in 2021.

Be smart: The Saudis are employing a very similar, if less overt, strategy that it did with golf: Outspend the more prestigious and established competitors for the best talent.

• Saudi teams are not bound by UEFA rules that govern how much those clubs can spend on players.
• "The league would like to have all the top players. And I think it is something that will be at the heart of this strategy," Saudi Pro League director Michael Emenalo said Sunday. "In a couple of years, in a few short years, this will become a league for exceptional players only."

The bottom line: It's doubtful that the Saudis can ever upend the major European leagues in stature, but they're now a legitimate competitor for the world's best players.