Geopolitics in Sport: Strategic Intelligence

An analysis of the geopolitics in sport sector provides a detailed, et easy to follow overview of the geopolitics in sport sector.

Dating back to the Second World War, professional sports have always been affected by geopolitical events. Every aspect of the sports business can be influenced by political situations, with Russia’s invasion of Ukraine in 2022 serving as a prime example. More recently, India and Pakistan have been on the brink of war after India launched airstrikes on Pakistan in response to a deadly terrorist attack in the disputed Kashmir region.
US tariffs could have a major impact on sports teams globally
One of the most immediate impacts of tariffs is the potential decline in sponsorship revenue. Companies in sectors like automotive and technology, which are heavily affected by tariffs, may reassess their marketing budgets, particularly their sponsorship commitments in sports. As these companies face increased costs and reduced profits, they may cut back on spending for sponsorships, which are crucial for many sports teams. For instance, Audi, a major sponsor in US sports, has already halted exports to the US, raising questions about its future sponsorship activities in the market. Tariffs on imported goods, such as the 25% tariff on steel and aluminum, could lead to increased costs for sports teams.
The US is set for its biggest decade in hosting sporting events
Between The US is poised to host its most significant decade of sporting events. Between 2024 and 2034, the country will cohost the 2026 FIFA World Cup, hold the 2028 Summer Olympic and Paralympic Games in Los Angeles, and host the 2034 Winter Olympic and Paralympic Games in Salt Lake City. This presents an opportunity for the US to showcase its ability to host major sporting events on a global scale. However, President Trump’s tariff policies could have negative effects on sponsorships, merchandise sales, and overall revenue for these upcoming events, particularly the 2026 FIFA World Cup.
Saudi Arabia is becoming a sporting superpower
Saudi Arabia has been making strides to become a prominent sporting hub. The nation has invested $6 billion in the sports industry and successfully hosted various sporting events, including Formula 1 races. Companies based in Saudi Arabia have pledged over $500 million in sponsorship investment funds to align themselves with some of the world’s biggest sporting properties. With its commitment to “Vision 2030,” which focuses on economic reform and improving the quality of life for its population, Saudi Arabia is expected to continue its mission to become a dominant force in world sport. As the host nation for the 2034 FIFA World Cup, Saudi Arabia has the opportunity to showcase itself as the premier destination for hosting the biggest event in world sports.

Scope

This report provides an overview of geopolitics in sport sector, including the key leaders, a look at some of key trends, an analysis of the industry in terms of market size and growth forecasts.

Key Highlights

The last tournament to be held pre-WWII was the 1938 edition in France, which saw Italy retain its trophy. The planned 1942 and 1946 editions were canceled outright due to the outbreak of WWII. Following the conclusion of the war, FIFA was once again in a difficult financial situation, having not had any way to financially sustain itself during wartime, and their first meeting post-war was held in 1946 to determine when the next tournament could be held. Hosted by Brazil, the next FIFA World Cup was held in 1950, although many nations were hesitant to take part given that many were still rebuilding and recovering from the disastrous damage caused by the Second World War. Surprisingly, Italy also participated even though many of their national team players were killed in an airplane crash in 1949, later dubbed the ‘Superga air disaster’. Germany and Japan were both unable to participate in the competition having both been suspended from FIFA, although both were later readmitted to FIFA in 1950, with Germany now competing as West Germany. The East German soccer team was inducted into FIFA in 1952. Many nations behind the Iron Curtain also declined to take part in the tournament, due to ongoing political turmoil.

The conflict between Ukraine and Russia has been ongoing since 2014 when Russia annexed Crimea and began moving its soldiers into the region. Friction arose over Russia’s belief that Ukraine is a Russian territory, while Ukraine has vehemently and repeatedly affirmed its independence. The conflict escalated in nature in February 2022 when Russia launched its invasion, with significant numbers of troops moving across the border. The effects on the region have been devastating, and the impact on the sporting world has also been of note.

Footballer Mesut Ozil, while at Arsenal, posted a tweet urging the world to pay greater attention to the plight of the Uyghur Muslims in China, and he criticized Muslims for not bringing the subject to more attention. Arsenal’s official Twitter account issued a statement announcing that Ozil’s views were his alone and that the club did not involve itself in politics. Arsenal has many business interests in China, and Ozil’s comments would have been impactful on Arsenal’s financial performance in that region. Around a similar time, Arsenal player Hector Bellerin encouraged young people to go and vote in the upcoming election, including an expletive towards politician Boris Johnson. The club did not acknowledge or respond to Bellerin’s post, highlighting the hypocritical nature of their stance, as this post was inherently political. In response to Ozil’s tweet, China removed him from three video games in response and stated that Ozil had “hurt the feelings” of Chinese fans. China also removed their upcoming broadcast of an Arsenal game from their schedule. The situation had wider repercussions, as German football team FC Cologne withdrew from the building of a football academy in China, on the grounds that Cologne should not cooperate with a country that was building a complete “surveillance state”.

Reasons to Buy

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