The International Olympic Committee (IOC) has cancelled a deal made with Saudi Arabia to host the first Esports Games.

The competition was due to be held in capital city Riyadh in 2027 as part of a 12-year deal with the country.

It had originally been due to launch this year, but was reportedly pushed back over concerns about the time needed to arrange the event.

A statement from the IOC said the two sides “mutually agreed” to end the deal but were committed to “pursuing their own esports ambitions on separate paths”.

Saudi Arabia has become a key player in the world of competitive gaming, and has hosted the annual Esports World Cup for the past two years.

After a boom before and during the Covid-19 pandemic, many major esports contests and teams have struggled to find the money to put on expensive in-person events.

Saudi Arabia has been willing to fund events through its Public Investment Fund (PIF) which it says is part of efforts to move away from its reliance on oil to generate income.

The kingdom has also invested heavily in more traditional sports, and critics argue that this practice – known as “sportswashing” – is designed to distract from the kingdom’s human rights record and its anti-LGBT laws.

Despite parting ways with the IOC, the country recently announced plans to start an Esports Nations Cup from November 2026, allowing contenders to compete under their national flags.

The IOC says it still has plans to hold an Olympic Esports Games of its own, to run alongside the traditional summer and winter Games.

It has previously run test events involving fighting and driving games, and in 2022 the Commonwealth Games hosted its own esports championship.

However, the organisers of the 2026 Games in Australia have ditched plans for a follow-up.

Saudi Arabia’s interest in the games industry extends beyond esports, and it recently led a bid to buy gaming giant Electronic Arts for a record $55bn (£42bn).

The company publishes popular video games including EA FC, Battlefield and Apex Legends.

This week, some of the biggest content creators linked to another big EA series, The Sims, said they would stop making videos about the game in protest at the sale.

Saudi Arabia also has stakes in Grand Theft Auto publisher Take Two, Resident Evil maker Capcom and Nintendo.

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