I feel like people just start regurgiating cliches when this topic comes up.
Football is massive in Arab countries and has been 100 years going back to British occupation. It is embedded in the culture. Al Ittihad was founded in 1927, within 20 years of many big European clubs.
As for competitive, they're bringing in 60 players this year, more than enough to make it competitive, and with the government basically overseeing the whole thing they can control the relative strength of the sides to create competition, similar to how US sports are configured from the ground up to enforce level competition.