Saudi Arabia's Neom Mega Project Continues as Planned Despite Scaling Back Claims

Saudi Arabia's minister of economy and planning, Faisal Al Ibrahim, has stated that the Neom mega project's 'The Line' continues as planned, with no change in scale. This comes amid recent claims suggesting the project has been scaled back from 170 km to 2.4 km. Al Ibrahim refuted these reports, saying "There is no change in scale. It is a long-term project that's modular in design."

The Neom project, which includes various components such as Trojena artificial lake, The Oxagon mega port, and resort destinations, is estimated to cost between $1 trillion and $1.5 trillion. The Saudi government is also seeking additional external investment in the project, which has so far received $925 billion in funding from the Public Investment Fund (PIF), the country's sovereign wealth fund.

Al Ibrahim acknowledged 'feedback from the market' and said the government would 'prioritize where we can optimize for optimal economic impact.' He also mentioned that the country is seeing growing investor interest in all of the Neom developments and has been touring a Neom road show in China to attract Chinese investors.

Why this matters: The Neom mega project is a flagship initiative of Saudi Arabia's Vision 2030 plan to diversify its economy away from oil. The project's success or failure could have significant implications for the country's economic future and its ability to attract foreign investment.

Despite conflicting statements from Saudi officials about potential scaling back of projects, Al Ibrahim emphasized that the Neom project is moving forward as intended. The kingdom plans to open Sindalah, the first region of the Neom megacity, by the end of 2024. Al Ibrahim stated, "The projects will go ahead as planned, with the first opening in late 2024 in a manner that in terms of priorities suits the needs [and returns] of the projects."

Key Takeaways

• Saudi minister affirms Neom's 'The Line' project continues as planned, no scale change.
• Neom project estimated to cost $1-1.5 trillion, funded by Saudi's sovereign wealth fund.
• Saudi govt seeking additional external investment for the Neom project developments.
• Neom's first region, Sindalah, to open by end of 2024 as per planned timeline.
• Neom's success crucial for Saudi's economic diversification away from oil under Vision 2030.