In a country where youth make up 70% of the 36 million population, at least 21 million are video game enthusiasts.
This is Saudi Arabia, which has placed significant emphasis on its citizens’ interests by investing in the electronic games sector as a crucial component of its economy.
The sector is expected to contribute SAR 50 billion ($13 billion) to the GDP, create over 39,000 job opportunities, and place the Kingdom among the top three countries globally in terms of professional e-sports players.
The Savvy Games Group, part of the Public Investment Fund, has committed $8.3 billion to acquire five international companies specializing in electronic games and to hold stakes in additional firms. Moreover, the group manages a substantial $38 billion fund dedicated to investments in this growing sector, according to the annual Savvy report released on Monday.
Additionally, the Saudi Social Development Bank launched a program to support the gaming and e-sports sector with a budget of SAR 300 million ($80 million) in 2022. By the end of last year, the budget had increased to SAR 1.09 billion ($290 million).
Future plans
Brian Ward, CEO of Savvy, told Asharq Al-Awsat that the company has signed a memorandum of understanding with Niantic to bring the game Pokémon GO to Saudi Arabia. The game will be launched in Riyadh, Jeddah, AlUla, and Abha.
The company is also working on establishing an Olympic version of electronic sports in Saudi Arabia, set to take place in the last quarter of 2025. According to Ward, the event will be a massive undertaking in Riyadh, comparable in scale and significance to the FIFA World Cup.
During a press conference in Riyadh, Ward disclosed plans to create an Xsolla Academy specializing in video game development, which has branches in India and Malaysia. The initiative is expected to generate 3,600 jobs by 2030.
Investment in talent
He explained that the group is collaborating with the Saudi E-sports Federation and the E-sports World Cup to develop training programs.
Savvy runs an exclusive internal training program at its studios, aimed at cultivating new talent, he revealed.
He stressed that while 5% of professional e-sports players globally were women, Saudi Arabia boasts a higher percentage at 20%, with the next closest country at 12%. This positions the Kingdom as a leader in this area.
Ward emphasized that foreign investment is a key pillar of his company’s efforts to attract investment into the gaming and e-sports sector in Saudi Arabia.
“Saudi Arabia is unique in having a national strategy for gaming and e-sports, supported by dedicated efforts from the government, the Public Investment Fund, Giga projects, and other relevant entities,” he added.
Fastest-growing
According to recent estimates by the Boston Consulting Group, global revenues from the gaming sector have surpassed those from the music industry, album sales, and the top five sports leagues.
The sector saw substantial growth during the COVID-19 pandemic, with global revenues increasing by 11% annually from 2018 to 2021, rising from $142 billion to $193 billion in just four years.
Revenues are projected to continue growing at a rate of 4% annually, surpassing $220 billion by 2027, with the number of global gamers nearing 4 billion.
According to Savvy’s annual report, Saudi Arabia was the fastest-growing market globally in the video game sector, with revenues reaching $1.13 billion in 2023. This figure is expected to increase to $1.21 billion this year, $1.28 billion by 2025, and $1.36 billion by 2026, reflecting a compound annual growth rate of over 6%, according to the Savvy report.
Additionally, the Kingdom is situated at the heart of the Middle East and North Africa, where revenues totaled $6.18 billion in 2023. This figure is projected to grow at an annual rate of 8% through 2025, making the region the fastest-growing globally.
