Fabulous

How Saudi Arabia’s vanity project is costing Kingdom trillions

Published 1 months ago on Sep 08, 2024

Saudi Arabia's NEOM: A Billion-Dollar Vanity Project Plagued by Blunders and Missing Workers.

Saudi Arabia’s ambitious NEOM megacity, touted as a futuristic marvel set to transform the Kingdom’s economy, has become mired in controversy and logistical failures, raising questions about its feasibility and long-term viability. Despite initial excitement, the multi-trillion-dollar project now faces intense scrutiny due to its unrealistic goals, delayed timelines, and alleged human rights abuses, according to experts.

NEOM, a cornerstone of Crown Prince Mohammed bin Salman’s Vision 2030, was designed to reduce Saudi Arabia’s reliance on oil and propel the country into the future as a global innovation powerhouse. With extravagant projects like “The Line” – a linear city envisioned to house millions – and plans for a fake moon and the world’s tallest skyscrapers, the megacity was intended to symbolize the Kingdom’s bold aspirations. However, experts now warn that NEOM may turn into a white elephant, draining the Kingdom’s resources and failing to deliver on its grand promises.

The Lofty Vision of NEOM

NEOM, first announced in 2017, was heralded as one of the most ambitious urban developments in history. Encompassing over 10,000 square miles of desert and mountains near the Red Sea, the project aims to integrate cutting-edge technologies, renewable energy, and futuristic infrastructure to create an unparalleled city of the future.

The flagship project within NEOM, The Line, was particularly ambitious. Originally intended to span 106 miles, the linear city was designed to house 1.5 million residents by 2030 in a mirrored structure with a footprint that stretches across Saudi Arabia’s desert landscape. The city promised to be a “civilizational revolution,” with no cars, roads, or pollution, powered entirely by renewable energy. The futuristic vision generated global headlines and attracted interest from investors eager to capitalize on the Kingdom’s efforts to modernize.

However, this bold vision has faced significant setbacks as costs balloon, timelines are missed, and controversies mount.

Unrealistic Goals and Soaring Costs

Dr. Frederic Schneider, an independent consultant specializing in post-oil economic transitions in the Gulf region, spoke to The Sun about the unrealistic nature of Vision 2030 and NEOM from the outset. He noted that the Kingdom’s grand plans have been viewed by many as overly ambitious and nearly impossible to achieve.

"When Vision 2030 was first announced, there was a lot of talk about how it was hugely ambitious," said Dr. Schneider. "Many people from the start said, 'okay, this is not only ambitious, that’s almost impossible.'"

One of the main challenges NEOM faces is its overwhelming cost. Dr. Schneider highlighted that The Line alone, initially budgeted at £500 billion, is now estimated to cost up to £2 trillion. This staggering price tag makes NEOM one of the most expensive development projects in history, placing immense financial pressure on Saudi Arabia.

Despite the Kingdom’s vast oil wealth, the project’s long-term sustainability has come into question. Foreign investors have been slow to commit to the project, deterred by the high risks and uncertain returns. As global economic trends shift and the viability of such large-scale developments diminishes, NEOM’s financial future appears increasingly precarious.

Scaling Back: The End of The Line?

Recent reports indicate that Saudi Arabia is already scaling back its ambitions for NEOM. The Line, which was once slated to accommodate 1.5 million residents by 2030, is now expected to house only 300,000 people and stretch a mere 1.6 miles. This reduction represents just 1% of its original dimensions, a stark contrast to the grand vision presented to the world.

Dr. Schneider expressed surprise that it took the Saudi government so long to announce these changes, noting that the Gulf region has a history of announcing large-scale projects that either fail to materialize or are drastically reduced in scope. Previous initiatives, such as King Abdullah’s Economic City, never reached their intended goals, leaving behind unfinished developments and unfulfilled promises.

"The Gulf region, including Saudi Arabia, has a history of announcing grand projects that never materialize," said Dr. Schneider. "There are plans in Kuwait – Medinat al Harir – that also never materialized. And all of these are very similar in style to NEOM."

Human Rights Concerns and Forced Evictions

While NEOM’s financial challenges are daunting, its human rights controversies have cast an even darker shadow over the project. Reports of forced evictions, threats, and violence against local tribes have marred the development, painting a grim picture of the lengths to which the Saudi government is willing to go to push the project forward.

The Huwaitat tribe, which has lived in the region designated for NEOM’s construction for centuries, has been particularly affected. At least 20,000 members of the tribe face eviction, with no clear plan for their relocation. Those who resisted the forced removals were met with harsh crackdowns, culminating in the death of prominent tribal leader Abdul Rahim al-Howeiti in 2020. His killing by Saudi security forces became a symbol of the brutal measures being taken to ensure the project’s progress.

Human rights activists have condemned the treatment of the Huwaitat tribe, with one campaigner stating, “Neom is built on Saudi blood.” The forced evictions and alleged executions have drawn international criticism, further damaging NEOM’s reputation and complicating efforts to attract foreign investment.

A Legacy in Jeopardy

For Crown Prince Mohammed bin Salman, NEOM is more than just a megacity – it represents his vision for Saudi Arabia’s future and his desire to leave a lasting legacy. However, experts like Dr. Schneider argue that the pursuit of these so-called “vanity projects” may ultimately prove economically and politically costly for the Kingdom.

Instead of pouring trillions into projects that may never reach fruition, Dr. Schneider suggests that Saudi Arabia should focus on more realistic and sustainable development within its existing cities, such as Riyadh. The capital city is already undergoing modernization and offers a more stable foundation for the Kingdom’s economic diversification efforts.

"Instead of following this pipe dream, why don’t we build on existing cities and existing advantages?" Dr. Schneider said. "They [Saudis] should probably cut their losses right now, right here, and go with more traditional developments."

NEOM, once hailed as the crown jewel of Saudi Arabia’s Vision 2030, is now struggling under the weight of its own ambition. The combination of soaring costs, logistical challenges, and human rights abuses has cast doubt on the project’s future. As the Kingdom grapples with global economic uncertainties and waning investor confidence, the dream of a futuristic city in the desert may remain just that – a dream. Without significant course corrections, NEOM risks becoming a costly symbol of failed aspirations, leaving behind a legacy of empty promises and unfulfilled potential.

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