Saudi Arabia’s economy minister, Faisal Al Ibrahim, has denied recent reports suggesting that the NEOM megaproject is scaling back some of its plans. NEOM is a $1.5 trillion futuristic desert development on the Red Sea coast, part of the kingdom’s Vision 2030 initiative to diversify the economy away from oil. Initial reports claimed that The Line project within NEOM, a glass-walled city stretching 105 miles, would only be 1.5 miles by 2030, with the population target reduced from 1.5 million to 300,000. Concerns over finances for NEOM have been raised, as the sovereign wealth fund has not approved the project’s budget for 2024.
Al Ibrahim emphasized that all NEOM projects are moving forward as planned, with decisions being made for optimal economic impact. The minister stressed that the projects will be delivered according to plan while ensuring that they do not overheat the economy or import too much against the kingdom’s interests. The long-term nature of the NEOM project, which is designed in a modular fashion, allows for flexibility while maintaining the intended scale. Despite reported changes in timelines and scales, all developments within NEOM are still of interest to private investors, as they are being built from scratch and require significant investment and support from the government and sovereign wealth fund.
The economy in Saudi Arabia is currently growing rapidly, and efforts are being made to ensure that the delivery of projects like NEOM does not have negative consequences. Al Ibrahim highlighted the importance of meeting priorities, delivering projects effectively, and promoting healthy non-oil growth within the economy. While decisions are being made to optimize economic impact, the minister confirmed that there have been no changes in the scale of the NEOM project. He also noted that increasing investor interest in all NEOM projects demonstrates confidence in their potential returns and economic impact.
Despite concerns over the scale and timeline changes in some NEOM projects, the minister assured that the developments will continue as planned and that there is no intention to reduce the scope of the megaproject. The unique nature of NEOM, along with its modular design, allows for adaptability while maintaining the overall vision for the project. Al Ibrahim acknowledged the need to balance priorities, returns, and economic impact to ensure the success of NEOM. He also reiterated that decisions would be made based on the needs of the projects and the economic environment to minimize risks and maximize benefits for all stakeholders involved.
Overall, Saudi Arabia remains committed to the ambitious NEOM project and is taking steps to ensure its success while also supporting the broader goals of Vision 2030. By prioritizing optimal economic impact and maintaining the scale of the projects within NEOM, the kingdom aims to attract private investors and foster sustainable growth in key sectors. Despite challenges and uncertainties, the government’s dedication to delivering on its promises and creating a thriving future for the region is evident through ongoing efforts to realize the full potential of NEOM.
