Saudi Arabia heading to the next level thanks to esports gamble

In September 2022, the Saudi sovereign wealth fund earmarked nearly $40 billion for a new conglomerate aimed at transforming the Kingdom into a global hub for games and esports by 2030. (Shutterstock)
Short Url
Updated 29 July 2023
Follow

Saudi Arabia heading to the next level thanks to esports gamble

  • Investment is part of Vision 2030 and plans to transform the Kingdom into a global hub for games and esports

RIYADH: With marquee football signings and a shake-up of the international golf tour, Saudi Arabia is making waves in the sporting world at an unprecedented rate.

Yet it is not just on the pitch or the green where the Kingdom is looking to become a global leader, it is on the console screen.

In September 2022, the Saudi sovereign wealth fund earmarked nearly $40 billion for a new conglomerate aimed at transforming the Kingdom into a global hub for games and esports by 2030 — and the move is already starting to pay off.

According to Vlad Belyanin, co-founder of True Gamers, a worldwide network of esports clubs that is launching in the Kingdom in early September, “everyone in the industry is looking at Saudi Arabia.”

Speaking to Arab News, he said: “After Ronaldo’s move to Al-Nasr and Al-Hilals €600 million ($662.06 million) offer to Lionel Messi we can expect Saudi Arabia to increase the integration of esports elements into traditional sports.

“I do not exclude that someone will assemble the best mixed team in the world, taking notable esports and traditional sports players.” 

The Middle East is a key player in the global gaming industry, with an impressive penetration rate and a strong commitment from governments to invest in the sector.

Alexander Schudey, managing director and partner at BCG

The investment by Saudi Arabia’s Public Investment Fund is part of the Kingdom’s Saudi National Gaming and Esports Strategy aimed at increasing the quality of life for egamers by improving players’ experience, providing new entertainment opportunities, and achieving an economic impact by contributing around SR50 billion ($13.33 billion) to the Kingdom’s gross domestic product by 2030.

The strategy is expected to lead to the creation of 39,000 new job opportunities by 2030.

Over $3 billion was invested in the industry by PIF last year, as part of the $38 billion commitment to be used by its company Savvy Games Group.

About a third of the announced amount will be spent on the purchase of a major game publisher, and the remaining funds will be used to acquire minority stakes in other gaming companies.

Acquisitions so far have included ESL and FACEIT for $1.5 billion in January 2022, Embracer Group for $1 billion in June 2022; VSPO for $265 million in March 2023, as well as Scopely for $4.9 billion in April 2023.

Brian Ward, CEO of Savvy Games Group told Arab News how the acquisition and merger of ESL FACEIT Group has enabled the creation of a force able to set the gold standard for esports competitions and gaming industry events. 




Saudi Arabia is attracting worldwide attention in the sector through its investments and acquisitions in cybersports. (Supplied)

“Saudi Arabia is very important for Savvy,” Ward said, adding: “It is a very exciting and rapidly growing market — the 19th biggest market globally. There are over 21 million gamers in KSA, 70 percent of the population — over 40 percent of whom are women.”

Ward stressed how Savvy’s aim is to make Saudi a global gaming hub. The company intends to do this by building capabilities and leading international and local gaming investments.

“We believe Savvy will have a significant beneficial economic impact in Saudi Arabia, both through its direct and indirect contribution to GDP, job creation and skills development,” he added.

The growth in esport is not confined to Saudi Arabia or the Middle East. Last year PwC predicted that in 2026 the global gaming industry would be a $320-billion industry, twice as much as in 2019.

Yet despite its global size, the Middle East is being seen as one of the hotspots for this growing industry.

According to a report from Boston Consulting Group released in June, more than 60 percent of the Middle East population are gaming enthusiasts, resulting in one of the highest shares of gaming mobile app downloads  — 50 percent compared to the global average of 40 percent.

“The Middle East is a key player in the global gaming industry, with an impressive penetration rate and a strong commitment from governments to invest in the sector,” Alexander Schudey, managing director and partner at BCG in a statement. 

Record investments are generating high expectations. Entrepreneurs who want to make money are now thinking about entering the Saudi-Arabian market.

Vlad Belyanin, co-founder of True Gamers

He added: “The region’s focus on gaming and the establishment of dedicated gaming hubs makes it an attractive destination for global gaming companies.

“The young and digitally savvy population, particularly in Saudi Arabia, where 70 percent of the population is below the age of 30, combined with higher disposable incomes and a preference for indoor activities due to the hot weather, further contribute to the region’s thriving gaming ecosystem.”

BCG’s latest report identified four major trends that will likely leave the biggest impact on the industry’s future.

These include audience growth and demographic shifts, whereby the gaming industry growth is broadening its demographic reach, appealing not just to Gen Y, who grew up playing video games, but also those entering their 30s, with an average gamer age of 31.

Another trend is innovation from players, with consumer communities playing a significant role in driving change in the industry, while mergers and acquisitions activity is leading the gaming industry to witness a surge in consolidation as major publishers, media companies and technology firms purchase studios and gaming-related assets globally. 

FAST FACTS

• Saudi Arabia’s National Gaming and Esports Strategy aims to contribute $13 billion to the Kingdom’s gross domestic product by 2030.

• PwC predicts that in 2026 the global gaming industry will be a $320-billion industry.

The final trend identified by the BCG report is new use cases, whereby the gaming industry is witnessing the emergence of the metaverse as a concept that is revolutionizing digital experiences.

The Kingdom is quickly becoming a global hub for gaming through investment and the launch of new products and technologies reflective of the above trends.

It is not just participants driving the growth of the sector, but those who wish to watch esports.

According to the Consumer Technology Association, the audience for cybersports will be 519 million viewers by 2024.

Technology and innovation play a major role in the esports industry and entrepreneurs, especially in Saudi Arabia, are capitalizing on these advancements to spur growth in the sector. 

We believe Savvy will have a significant beneficial economic impact in Saudi Arabia, both through its direct and indirect contribution to GDP, job creation and skills development.

Brian Ward, CEO of Savvy Games Group

“Cybersport is becoming an experimentation ground for artificial intelligence, chips, visualization, and big data technologies,” Belyanin told Arab News.

He added: “Games are becoming more accessible. The growing popularity of games on smartphones and tablets compared to PC gaming systems is driving game makers to release games on different platforms.

“Cross-platform and cloud-based gaming solutions promote hardware-independent games, and artificial intelligence ensures fair gameplay. Social gaming and cyber sports provide a platform for developers and players to build healthy gaming communities and improve brand reach.”

Sponsoring and hosting esports events and competitions further allows developers to build brand awareness and attract new players, he states, noting how True Gamers is developing and implementing new technologies in the user experience at its cybersports centers.

For example, True Gamers is the first in the world to use robotic dogs as waiters in clubs. Three mechanical assistants will appear in different clubs in Dubai, and by the end of 2024 their number will increase to around 20. Production of the test technology cost $100k, as well as an average $10k a month on updates and modifications of robots.

Saudi Arabia, stresses Belyanin, is attracting worldwide attention in the sector through its investments and acquisitions in cybersports.

“Record investments are generating high expectations,” he adds. “Entrepreneurs who want to make money are now thinking about entering the Saudi-Arabian market.

“They are thinking: ‘There is a lot of investment, so there is a lot of profit, and therefore I need to enter the market.’”

Belyanin added: “My point of view is different. If there are a lot of investments, the new gaming culture starts to grow there and therefore, it is interesting to work with it.

“This is huge long-term work, which will bring much more than a quick profit. We are not afraid of large-scale tasks; we are keen to create the future of gaming with our own hands.”


Riyadh Air signs 11 deals to boost global reach and promote Saudi culture and hospitality

Updated 01 May 2025
Follow

Riyadh Air signs 11 deals to boost global reach and promote Saudi culture and hospitality

  • The airline, which is preparing to begin operations, plans to connect with more than 100 cities by 2030 and contribute $20bn to the Kingdom’s economy between now and then
  • Senior VP Osamah Al-Nuaiser said the deals will help deliver exceptional travel experiences across Europe, Africa, the Middle East, Asia, Australia and New Zealand

JEDDAH: New Saudi airline Riyadh Air signed 11 strategic agreements this week it said will expand its global footprint, elevate the travel experience, and help promote the Kingdom’s culture and hospitality.

The deals, finalized during the Arabian Travel Market in Dubai, which began on Monday and concluded on Thursday, involve sales and distribution service providers in more than 125 countries.

Riyadh Air, which is owned by Saudi Arabia’s Public Investment Fund, aims to connect with more than 100 international cities by 2030, and contribute more than $20 billion to the Kingdom’s economy between now and then, the Saudi Press Agency reported on Thursday.

The airline said it plans to enhance the travel experience by leveraging digital technologies to streamline bookings and airport procedures, thereby catering to the country’s young, tech-savvy population, as previously highlighted by CEO Tony Douglas.

Osamah Al-Nuaiser, senior vice president of marketing and corporate communications at Riyadh Air, said the agreements signed this week reflect the airline’s commitment to becoming a global leader in aviation.

They are designed to build long-term, mutually beneficial relationships that help deliver exceptional travel experiences across Europe, Africa, the Middle East, Asia, Australia and New Zealand, he added.

As authorities in the Kingdom continue to invest billions into massive development projects as they work to diversify the national economy and reduce its reliance on hydrocarbons, one of their goals is to gain a larger share of the global travel market, including business travel.

Riyadh Air received approval from the Kingdom’s General Authority of Civil Aviation in April to begin flight operations. It was granted its Air Operator Certificate after fulfilling all regulatory, safety, and operational requirements, marking a key milestone in the run-up to the official launch of commercial flights.

Riyadh Air said the flexibility offered by the adoption of the most modern technologies, free from the constraints of legacy systems, will enable the airline to innovate with agility and offer seamless booking, distribution and other services across its global network.

Douglas said recently that the startup is ready to purchase Boeing aircraft originally ordered by Chinese airlines, should they become available as a result of the escalating US-China trade dispute.

The fledgling airline has also placed major orders of its own with manufacturers, including a deal in October last year for 60 narrow-body A321-family jets from Airbus, and another in March 2023 for up to 72 Boeing 787 Dreamliners.


PIF announces pricing of $1.25 billion international sukuk offering

Updated 01 May 2025
Follow

PIF announces pricing of $1.25 billion international sukuk offering

  • The sukuk will be listed on the London Stock Exchange’s International Securities Market
  • PIF’s Ahmed Alrobayan said: ‘The strong investor demand for this new sukuk offering underscores PIF’s robust credit profile’

RIYADH: The Public Investment Fund on Thursday announced the pricing of a $1.25 billion sukuk offering, with the proceeds of the dollar-denominated offering to be used for PIF’s general corporate purposes.
The seven-year sukuk was more than 6.5 times oversubscribed, with orders exceeding $9 billion, according to a media statement.
The sukuk will be listed on the London Stock Exchange’s International Securities Market as part of PIF’s international sukuk issuance program.
Ahmed Alrobayan, head of public markets, global capital finance, at PIF, said: “The strong investor demand for this new sukuk offering underscores PIF’s robust credit profile, along with its role as a key driver of Saudi Arabia’s economic transformation.”
The transaction represents a continuation of the established and diversified financing strategy, which draws strong support from international investors, Alrobayan said.
PIF’s long-term capital-raising strategy includes a diverse range of instruments, including sukuk and bond programs.
PIF has completed its inaugural murabaha credit facility since earlier this year, and last August renewed a revolving credit facility.
PIF is rated Aa3 by Moody’s with a stable outlook, and A+ by Fitch, also with a stable outlook.


Qassim region sees 25% growth in business sector over 7 years: Ministry of Commerce

Updated 01 May 2025
Follow

Qassim region sees 25% growth in business sector over 7 years: Ministry of Commerce

JEDDAH: Saudi Arabia’s Qassim region has experienced 25 percent growth in its business sector over the past seven years, reflecting increased economic activity and contributing to the Kingdom’s goal of balanced development.

The number of commercial records in the central region rose from 68,000 in 2018 to 85,000 by the end of the first quarter of this year, the Ministry of Commerce reported in a post on its official X account.

The latest figures showed that the Qassim region saw 1,342 e-commerce registrations, contributing to the overall 6 percent year-on-year increase in the sector.

The increase comes as the Kingdom pushes ahead with its economic diversification strategy, aiming to increase the private sector’s share of the gross domestic product from 40 percent to 65 percent by 2030.

This effort is reflected in a 60 percent increase in commercial registrations in 2024 across the Kingdom, with a total of 521,969 records issued, according to the Ministry of Commerce.

Business registrations continued to rise in early 2025, with 154,638 commercial records issued in the first quarter alone, representing a 48 percent year-on-year increase.

The ministry report highlighted “critical sectors” for the Kingdom include technology, tourism, and entertainment, as well as research and development.

The report added: “These sectors offer businesses significant opportunities to grow and expand partnerships.”

According to the Ministry of Commerce, a commercial registration certificate verifies a business’s official status within Saudi Arabia. These records are essential for operating in the Kingdom, as they are required to open a bank account, hire employees, sign contracts, and conduct other business activities.

The data also showed that 71 percent of the total commercial records issued were concentrated in three key regions: Riyadh, Makkah, and the Eastern Province.

This surge in registrations aligns with recent reforms to Saudi Arabia’s business registration system, including the introduction of the new Commercial Register Law and Trade Names Law.

Subsidiary registers have also been abolished, meaning that one commercial register now covers all businesses, and companies no longer need to specify the city of registration, as a single enrollment is now valid nationwide.

The bulletin also revealed that 45 percent of the total commercial records issued to institutions are owned by women.

In an interview with Arab News in April on the sidelines of the Human Capability Initiative held in the capital, Zeger Degraeve, dean of Prince Mohammed Bin Salman College of Business & Entrepreneurship, emphasized that ensuring balanced regional development is crucial as Saudi Arabia accelerates its economic diversification efforts under Vision 2030.

The rise in business registrations in Qassim is aligning with its growing industrial sector, supported by its rich mineral resources, which are a key focus of Saudi Arabia’s Vision 2030 diversification plan.

The region’s SR122 billion ($32.5 billion) in untapped mineral wealth, including significant deposits of gold, copper, zinc, and phosphate, contributes to the area’s industrial development, which has seen substantial growth.


Closing Bell: Saudi main index closes in red at 11,543  

Updated 01 May 2025
Follow

Closing Bell: Saudi main index closes in red at 11,543  

RIYADH: Saudi Arabia’s Tadawul All Share Index dipped on Thursday, losing 127.90 points, or 1.10 percent, to close at 11,543.67.  

The total trading turnover of the benchmark index was SR5.09 billion ($1.35 billion), as 52 stocks advanced, while 193 retreated.  

The MSCI Tadawul Index decreased by 16.97 points, or 1.14 percent, to close at 1,471.91. 

The Kingdom’s parallel market Nomu also dipped, losing 147.4 points, or 0.52 percent, to close at 28,129.77. This came as 32 stocks rose, while 41 fell. 

The best-performing stock on the main index was Saudi Printing and Packaging Co., with its share price surging by 6.18 percent to SR13.06.  

Saudi Cement Co. saw the steepest decline on the main index in Thursday’s session, with its share price slipping 5.75 percent to SR43.40.  

In a bourse filing, Banque Saudi Fransi announced that it has completed its $650 million offering of US dollar-denominated Additional Tier 1 capital notes.  

The issuance, conducted under the bank’s Additional Tier 1 Capital Note Programme, was offered to eligible investors in Saudi Arabia and internationally, with settlement set for May 7.  

The notes were issued at a return of 6.375 percent per annum and are perpetual in nature, with a call option exercisable after six years. A total of 3,250 notes were issued, each with a par value of $200,000. 

According to the bank, the instruments may be redeemed prior to the scheduled call date under certain conditions outlined in the base offering circular.  

The notes will be listed on the International Securities Market of the London Stock Exchange and were offered in reliance on Regulation S under the US Securities Act of 1933, as amended. 

The bank’s share price traded 0.54 percent lower on the main market to reach SR18.30.

Halwani Bros. Co. also announced its interim financial results for the first three months of the year, with net profit amounting to SR11.51 million, a 4.58 percent decline compared to the previous quarter last year.  

The company attributed the decrease to higher general and administrative expenses, as well as increased selling and distribution costs. It also said that this was due to an increase in other income as a result of the reversal of provisions that are no longer needed.  

Halwani Bros. Co’s share price traded 0.52 percent lower on the main market to reach SR47.95.  

In the first quarter of 2025, Fourth Milling Co’s net profit rose 25.154 percent quarter on quarter to SR52.6 million, according to a filing on the stock exchange.  

The group attributed the increase to sales growing by 2 percent, amounting to an increase of SR3.4 million, and zakat and tax payments decreasing by SR1.4 million.  

The company’s share price traded 0.25 percent lower on the main market to reach SR3.97.  

Saudi Steel Pipe Co. also announced its interim financial results for the first three months of the year, with net profit amounting to SR69 million, an 81.57 percent surge compared to the previous quarter.  

The company attributed the increase to higher volume, improved efficiency and product mix of products sold, and administrative expenses decreased to SR14 million in the first quarter 2025 from SR19 million in the fourth 2024. 

The company’s share price traded 0.18 percent higher on the main market to reach SR56.10. 


Arab Monetary Fund reports 4.3% annual gains across region’s stock markets

Updated 01 May 2025
Follow

Arab Monetary Fund reports 4.3% annual gains across region’s stock markets

RIYADH: Stock markets across the Middle East and North Africa began 2025 on a strong note, with the Arab Monetary Fund Composite Index rising 4.37 percent year over year, according to a new report.

On a quarterly basis, the index — which tracks the performance of 16 Arab stock markets— posted a 1.55 percent increase, reflecting investor confidence amid shifting global monetary policy and geopolitical headwinds.

The figures were released as part of the AMF’s quarterly bulletin, which noted that sectors such as banking, real estate, and basic materials, as well as transportation, and financial services performed well, contributing to gains in several markets. 

The strong performance comes amid reforms across Arab markets to deepen liquidity and attract foreign investment. Saudi Arabia’s Capital Market Authority is advancing its 2024-2026 strategy to elevate its global market position and enhance investor safeguards, while Abu Dhabi Securities Exchange recently launched the “New ADX Group”— a market infrastructure overhaul aligned with the emirate’s long-term economic vision. 

In its report, the AMF said: “This performance unfolded amid a tightening global monetary policy environment during the first quarter of 2025, as most central banks, both globally and across the Arab region, adopted a cautious approach to monetary easing following the US Federal Reserve’s decision to keep interest rates steady.”

The fund highlighted that while some Arab exchanges saw notable gains, others experienced declines. 

Casablanca Stock Exchange led the region with a 20.19 percent rise in its index, driven by strong performances in the banking and telecommunications sectors. 

Tunisia and Kuwait followed with increases of 10.25 percent and 9.66 percent, respectively, while Egyptian Exchange and Amman Stock Exchange posted gains of 7.68 percent and 6.12 percent.

However, not all markets fared as well. Saudi Stock Exchange, the largest in the region by market capitalization, saw a slight decline of 0.10 percent, while Abu Dhabi Securities Market and Palestine Exchange recorded drops of 0.53 percent and 0.46 percent, respectively. 

Beirut Stock Exchange faced the steepest decline, plummeting by 12.69 percent, attributed to ongoing economic challenges in Lebanon.

Despite Lebanon’s ongoing economic crisis since 2019, recent data from the Central Administration of Statistics shows signs of easing inflationary pressures. 

The annual inflation rate dropped sharply to 14.2 percent in March, down from 70.36 percent a year earlier — a notable improvement attributed largely to the stabilization of the Lebanese pound, which has held steady at approximately 89,500 Lebanese pounds per US dollar since mid-2023.

Casablanca Stock Exchange led the rises across the region. Shutterstock

Market capitalization and trading activity 

The total market capitalization of Arab stock markets decreased by 1.45 percent in the first quarter of 2025, reaching $4.32 trillion, down by $63.77 billion compared to the last quarter of 2024. 

This decline was primarily due to significant losses in the Abu Dhabi and Saudi markets, which shed $18.23 billion and $75.06 billion, respectively.

In contrast, Casablanca Stock Exchange added $21.26 billion to its market value, while Kuwait Stock Exchange saw an increase of $13.77 billion. 

Trading values also reflected this mixed performance. Total trading value across Arab markets fell by 2.60 percent to $250.53 billion.  

Kuwait Stock Exchange stood out with a 45.09 percent surge in trading value, reaching $21.95 billion. This strong performance builds on 2024’s momentum, when 113 out of 142 listed companies reported profits, as highlighted in an Al-Shall Consulting report.

Meanwhile, Abu Dhabi Securities Market saw a 31 percent drop in trading value.

Sectoral performance and global influences 

Global factors played a significant role in shaping market trends, with sectors scuh as insurance, consumer services, and media faced declines. “The cautious monetary policies of most global and Arab central banks, following the US Federal Reserve’s decision to stabilize interest rates, positively impacted lending and financing stability,” the study stated. 

However, it also warned that “the escalation of US trade policies, including new tariffs, has raised concerns about slowing international trade and rising production costs, which could directly affect global growth expectations, inflation rates, and investor confidence.”

Geopolitical tensions and fluctuations in oil prices further influenced market dynamics. “Oil prices experienced significant volatility during the first quarter of 2025 due to escalating geopolitical tensions and increased production from some countries, impacting markets closely tied to oil and affecting liquidity and the performance of the energy sector,” the AMF explained.

Individual market highlights 

Saudi Stock Exchange is the largest in the region by market capitalization. Bloomberg

Saudi Stock Exchange, which accounts for 61.13 percent of the total market capitalization of Arab exchanges, saw its value drop to $2.64 trillion. The media and utilities sectors were among the worst performers, declining by 31 percent and 13 percent, respectively.

Despite the recent dip, Saudi Arabia’s capital markets remain a regional powerhouse.

Speaking at February’s Capital Markets Forum in Riyadh, Saudi Exchange CEO Mohammed Al-Rumaih said:  “2024 was a great year for us. We did more than 55 listings; around 45 in the equity market, 13 on the main market, which doubled compared to 2023, and the rest in the parallel market. It put us as No.1 not just in the region, but globally as the fastest-growing exchange in the world.”

Egyptian Exchange rose by 7.68 percent, with trading volumes surging by 27.28 percent, reflecting renewed investor confidence.  

Kuwait Stock Exchange outperformed other Gulf markets, with its index climbing 9.66 percent, supported by robust activity in the banking sector. 

Casablanca Stock Exchange’s 20.19 percent jump was fueled by gains in electricity, mining, and telecom stocks, with firms like Attijariwafa Bank and Maroc Telecom leading the charge.  

Risks and outlook 

The report cautioned that several risks could destabilize Arab and global markets in the coming months.

“Potential risks include trade-related pressures linked to tariffs, a possible global economic slowdown, rising inflation, fluctuations in oil prices, high debt levels in some Arab economies, and geopolitical tensions,” it stated.

Despite the relative stability of Arab exchanges in the inaugural quarter of 2025, these factors could pose challenges to future performance. 

The AMF also emphasized the importance of continued cooperation among Arab markets to enhance integration and support economic growth in the region. 

“The Fund hopes that these efforts will contribute to developing cooperation and integration among Arab financial markets, serving common interests and promoting economic growth in the Arab region,” the analysis concluded.