Football at the Heart of UK-Saudi relations
Football has once again taken centre stage politically in the United Kingdom. With just over one month left in the English Premier League season, ownership questions about Saudi Arabian-controlled Newcastle United are resurgent. A recent report from The Athletic revealed 59 pages of email conversations between British government officials discussing the potential sale of the club in 2020. The emails make clear that the UK government, under Boris Johnson at the time, was [quietly] lobbying the EPL to approve the sale of Newcastle United to the Saudi Arabian Public Investment Fund (PIF).
In recent years, Saudi Arabia, like its neighbours, Qatar, and the United Arab Emirates, has invested significantly in sport. This investment forms part of the kingdom’s Vision 2030 plan which represents a wider government strategy to modernise the nation by diversifying the economy away from oil production and exportation. Additionally, sport is also a conveniently popular mechanism through which the Saudi state can improve its image, a phenomenon known as sportswashing. Via its sovereign wealth fund, Saudi Arabia has financed the controversial LIV Golf tour, a new Formula 1 race in Jeddah, WWE tournaments, the Spanish and Italian Super Cups and championship boxing events. It also recently invested in luxury car company Aston Martin, and Saudi Aramco, the state oil company, is sponsoring the Aston Martin Formula 1 team. These events and investments have drawn new eyes to the kingdom, increasing its tourism, name recognition and global appeal.
Given the popularity of football and specifically the Premier League, it was only a matter of time before Saudi Arabia moved to purchase an English football club. In March 2020, a consortium composed of the PIF, PCP Capital Partners and Reuben Brothers officially submitted a bid to purchase Newcastle United from British owner Mike Ashley. According to the Guardian, initial signs were good. The Premier League even privately informed the consortium that the deal would have “no red lights.” But, by late July 2020 the deal was dead, as the league was concerned about the legal separation between the PIF and the Saudi government. It could not accept a Saudi state-run club at a time when the Saudi government was accused of pirating the league’s Middle East broadcast from official rights holders beIN Sports.
What was unknown until The Athletic reported on the email chain, were the lengths to which the British government was going to help secure the Saudi takeover deal. The reason for which stems back to international trade agreements. In the latter days of Theresa May’s premiership, she sat down with the Saudi Crown Prince Mohammed bin Salman (MBS) at 10 Downing St and discussed a strategic partnership between the two nations. The partnership would include $30 billion of direct investment from the PIF into the UK over a ten-year period. The Athletic’s report, also includes a cable from the British ambassador in Riyadh, which states that Newcastle United was at the heart of Saudi investment plans for north-eastern Britain.
Northeast England is one of the most economically depressed regions of the UK. According to Statista, its GDP per capita in 2020 was the lowest in the UK at roughly £23,000. Moreover, its total export and import trade levels were the second lowest in the UK, with only Northern Ireland performing worse. The promise of direct investment into the region from a historically rich trade partner was enough incentive for the government to lobby the Premier League to accept the Saudi takeover bid. As if this wasn’t enough, when questions began to arise about the sovereignty of the PIF, MBS communicated to PM Boris Johnson that there would be “economic consequences” if the Premier League resisted the takeover attempt.
Unsurprisingly, according to the Athletic, “the British government considered the possible failure of the Saudi takeover of Newcastle United to be an immediate risk to the United Kingdom’s relationship with the Gulf nation.” As such, the government appointed a senior interlocutor – Lord Gerry Grimstone, a minister at the department of International Trade (DIT) -- to impress government interests on the Premier League. The DIT itself, along with the Foreign Office made what they described in their emails as “PR offers' ' to show the Premier League a more positive image of Saudi Arabia and limit any negative publicity. Foreign Office officials even stated, “there is space to add colour to the real reforms on the ground.”
Despite publicly claiming neutrality and non-interference, these conversations show that the conservative government voiced its opinion loudly and frequently in favour of the potential Saudi takeover of Newcastle United. This is best illustrated by two government communications captured by the Athletic. The first is a May 2020 internal email and the second is a script prepared by the UK deputy ambassador to Saudi Arabia for those dialling into an internal government call in June 2020.
The May 2020 email states quite bluntly, the “FCO (Foreign & Commonwealth Office) is clear that we support further Saudi investment in the UK, including Newcastle United”. The June 2020 script cautiously expounds on this, reading, “It’s not for HMG (Her Majesty’s Government) to intervene in buying/selling football clubs. But HMG is not neutral about the UK's relationship with Saudi Arabia. It is a crucial and valuable relationship with an important partner, regionally and globally. The purchase of Newcastle United by KSA’s (Kingdom of Saudi Arabia) sovereign wealth fund would be a valuable boost to the relationship and signal of intent for further Saudi investment in the northeast (the region of England where Newcastle is).”
Despite all the background political pressure the takeover bid was initially rejected by the Premier League. But after the World Trade Organization (WTO) settled a longstanding Qatar-Saudi Arabia piracy issue, the deal was suddenly alive again. By October of 2021 the second takeover bid– which cost £300 million - was accepted on the condition that the Premier League receive “legally binding assurances,” that the Saudi government will not control Newcastle via the PIF.
Since the takeover, the new owners have invested over $450 million into the club, and performances on the field have seen them rise from second to last, to fourth in the league. Off the field, Saudi Arabian companies SABIC and Alfanar have invested $1.8 billion into green aviation and decarbonisation projects in northeast England. Further afield, trade between the two nations continues to be prosperous. According to the UK Department of Business and Trade, the total trade in goods and services through Q3 of 2022 was £15.3 billion. This showed a 47.2% increase on the previous year. Of this total, imports from Saudi Arabia were roughly £4.2 billion, while exports from the UK to Saudi Arabia were £11.1 billion. OEC shows the top exports to Saudi Arabia from Britain were gas turbines, packaged medication, and jewellery. Meanwhile the Saudis mostly sent petroleum, cars, and engines to the UK.
However, these trade agreements do not come without criticism. According to Human Rights Watch, the UK has supplied over $23 billion worth of weapons to Saudi Arabia since the start of the Yemeni Civil War. These weapons include Paveway guided bombs, Brimstone and Storm Shadow missiles and Typhoon aircraft. All of which have been deployed in Yemen, which has seen over 19,000 civilian deaths throughout the course of the war. Despite the alarming humanitarian crisis British weapons have caused in Yemen, trade with Saudi Arabia is still considered vital.
UK Foreign Office and Commonwealth documents underline the vitality of the bilateral relationship stating, “The United Kingdom and the Kingdom of Saudi Arabia enjoy a deep, long-standing history of friendship and co-operation.” Adding, “Saudi Arabia is one of the UK’s largest trading partners in the Middle East and the leading exporter of goods to the UK.” The documents go on to say that the UK government does not see eye-to-eye with its Saudi counterparts on human rights, explicitly the use of the death penalty, restricted access to justice, women’s rights and restricted freedoms of expression, assembly, and religious belief. Despite this, the Foreign Office repeatedly put business over human rights concerns when acting as intermediary for the Newcastle United purchase. Most likely because it considers its trade relationship with Saudi Arabia to be critical. Given the economic downturn in the wake of Brexit and the COVID-19 pandemic, the United Kingdom must maintain its strategic trade partnerships. The UK has been negotiating investment deals with Saudi Arabia and other GCC members that it cannot afford to go without. Therefore, human rights concerns and ownership issues must be swept under the rug.
The Premier League and the UK government now find themselves in a bind. In a US court case against the Saudi LIV Golf tour, the PIF claimed it could not be prosecuted to diplomatic immunity. It further stated that the PIF and Newcastle United chairman, Yasir Al-Rumayyan, “are a sovereign instrumentality of the Kingdom of Saudi Arabia and a sitting minister of the government.” This directly contradicts the “legally binding assurances” the Premier League claimed to have received when approving the second PIF-led Saudi takeover bid of Newcastle United. Furthermore, it lends credibility to the notion that the UK government leaned on the Premier League to accept the second bid because the trade relations between the two nations were so vital. Leading of course to the conclusion that human rights issues, assassination and potential war crimes have all been tabled because the UK requires Saudi investment and will go to any lengths to maintain its beneficial trade relationship.
Meanwhile, Saudi Arabia has found a foothold in the British community via sport investment. The on-field success of Newcastle United, like Abu Dhabi owned Manchester City before it, has helped erase the owners off-field blemishes and has secured much needed economic diversification. It has also increased British reliance on Saudi investment in areas of economic depression. Football has once again proven to be a valuable vehicle for political gain for a Gulf nation.