Saudi Arabia’s plan to spend over $500 billion on a futuristic, eco-friendly city in the desert may not turn out quite like it was once envisioned.
The reality of such an extensive financial project has begun to cause concern among investors as work slows down and the Saudi Government is yet to announce Neom’s 2024 budget.
The Futuristic City Shrinks in Size
At the core of the Neom, an extensive development project launched by Crown Prince Bin Salman, is a futuristic city once predicted to run over 105 miles long known as The Line.
However, the plans for the desert metropolis appear to have been scaled back, with rumors suggesting the city will only stretch for a mile and a half by 2030.
Scaling Down on Prince Mohammed’s Project
Prince Mohammed, the son of the King of Saudi Arabia, Salman, is the face of Neom and the wider Vision 2030 project, which aims to restructure the country to ensure everyone has the opportunity to succeed.
The prince has claimed he wants to revolutionize the Saudi nation and reduce its dependency on oil.
Neom’s Plans For the Future
Alongside the megacity, Neom’s other projects include an extensive industrial city, large ports, and tourism developments.
The region is even set to host the 2029 Asian Winter Games at Torjena, a luxurious mountain resort.
$1.5 Trillion Project
Originally, Saudi Arabia pledged to commit at least 500 billion to Crown Prince Mohammed bin Salman’s Vision 2030 project.
Further investment coming from local and overseas investors brought the project budget to around $1.5 trillion.
Work Began in the Desert Back in 2017
Work on the construction of the megacity began back in 2017.
However, reports suggest that excessive spending of the nation’s money on The Line has been deemed controversial by high-ranking members of the Saudi government, per Bloomberg.
Saudi Government Forced to Lower Estimations
Initial projections suggested that over 1.5 million people would already live in the futuristic city by 2030.
However, due to recent financial problems, officials have projected that the city could house as few as 300,00 people.
Saudi Government Yet to Announce 2024 Funding
One of the major problems surrounding the project is the kingdom’s sovereign wealth fund has yet to approve Neom’s 2024 budget.
According to the experts, the reality of spending trillions of dollars has begun to cause concern within the Saudi government.
Companies Begin Pulling Workers From the Site
According to Bloomberg, as a result of the pullback, at least one company has begun dismissing its workers from the site.
This appears to have happened after officials claimed that some of Neom’s other projects would be delayed well beyond 2030.
More Time is Needed to Build
Speaking in December, Finance Minister Mohammed Al Jadaan said more time is needed to “build factories, build even sufficient human resources.”
He continued, “The delay or rather the extension of some projects will serve the economy.”
Further Problems Surrounding the Project
It’s not just finances that have dampened the megacity; in recent years, several ethical issues have made headlines on numerous occasions.
From Prince Mohammed’s alleged involvement in the killing of Washington Post journalist Jamal Khashoggi to rumors that Saudi officials killed several members of a tribe who refused to leave their ancestral lands, the entirety of the Neom project has been tainted long before it’s even finished.
US Journalist Shares Thoughts on Saudi City
In 2021, US journalist Robert Worth shared his thoughts on a video released by Neom which described the prospects of its futuristic city.
“To watch the crown prince’s promotional video is to be immersed in a distinctively Saudi form of arrogance, blending religious triumphalism and royal grandiosity.”
Financial Strains and Adjustments
As Neom’s grand vision confronts reality, the financial strains are becoming increasingly apparent. With the Saudi sovereign wealth fund still undecided on Neom’s 2024 budget, the project’s financial sustainability is in question.
The ambitious scope of the city, initially set at $500 billion now faces potential cutbacks, delaying some of the most innovative features planned for the urban development (via the WSJ).
Technological Hurdles in Desert Construction
Implementing cutting-edge technology like cloud seeding and robotic services in Neom poses unique challenges.
The harsh desert environment tests the limits of current technology, with sand and heat complicating maintenance and operation. These hurdles must be overcome to realize the high-tech oasis Saudi officials have envisioned.
Environmental Concerns in Desert Development
Building a futuristic city in the desert raises significant environmental concerns. The construction of Neom disrupts local ecosystems, and the sustainability of such a large-scale development is under scrutiny.
Efforts to minimize ecological impact are critical to the project’s acceptance and success.
Delays in Core Infrastructure
Neom’s infrastructure, crucial for its development, is lagging. The delay in establishing essential utilities and transport links hampers the project’s progress, pushing back the timeline for becoming a fully operational city.
These delays could have ripple effects on investment and confidence in the project’s completion.
Labor Dynamics and Employment Shifts
The scaling back of Neom has led to fluctuations in employment, affecting both local and international workers (via FirstPost).
Reports indicate changes in labor needs, with some companies reducing their workforce. This impacts not only the project’s timeline but also the livelihood of thousands involved in construction.
Impact on Local Economies
Neom’s construction impacts surrounding communities economically and socially. While some local businesses benefit from the influx of workers, others suffer from the changes brought by such a massive project.
Balancing economic benefits with community welfare is a significant challenge for the Saudi government.
Attracting Global Talent to Neom
Neom aims to be a hub for innovation, requiring a skilled global workforce. However, attracting this talent is challenged by logistical, cultural, and professional hurdles.
Ensuring competitive benefits and a high quality of life is essential for drawing the expertise needed to fulfill Neom’s tech-driven aspirations.
Cultural Integration and Social Dynamics
Integrating a futuristic city like Neom into Saudi Arabia’s conservative cultural landscape presents its own unique set of challenges.
The project’s progressive features may clash with traditional values, necessitating sensitive handling to foster social acceptance and integration.
Surveillance and Security Measures
The high-tech infrastructure of Neom includes extensive surveillance capabilities, raising privacy concerns (via The New York Post).
While intended to enhance security, the potential for surveillance to be used for authoritarian purposes has alarmed human rights observers, echoing broader concerns about privacy in the digital age.
Foreign Investment and International Relations
Neom’s success heavily relies on foreign investment and international cooperation.
The project’s ability to attract global capital is important but faces scrutiny due to geopolitical tensions and internal challenges within Saudi Arabia, including human rights issues (via The New Arab).
Media Influence and Public Perception
Neom’s portrayal in the media significantly affects public perception. Positive coverage can attract investment and residents, while negative reports may deter both.
Managing this aspect is crucial for maintaining momentum and ensuring the project’s image aligns with its ambitious goals.
Revising Goals for the Future
Given the array of challenges, Neom’s initial goals are being reevaluated. Updated projections consider current realities, focusing on achievable targets.
This recalibration could help maintain stakeholder trust and ensure the project’s long-term viability in the evolving landscape of global city development.
