Saudi Arabia’s Neom, an entirely new city built on the Red Sea coast, has finalized a deal worth more than 21 billion riyals ($5.6 billion) with local investors. This is the third Investment to back the kingdom’s most ambitious project to diversify its economy in the past month.
Neom is a critical element of Crown Prince Mohammed bin Salman’s Vision 2030 plan, an initiative to transform society and reduce dependence on oil. The government set up a company called Neom to lead the building effort and has hired three of the world’s largest consultancy firms — McKinsey & Co, Boston Consulting, and Oliver Wyman — to advise it. The company is expected to spend $500 billion on the project, which envisions a metropolis free of cars and streets, powered by clean energy, and run with a high level of artificial intelligence.
Construction is underway, with excavation work starting this month along the 170-kilometer coastal strip in northwest Saudi Arabia. Designed by renowned architects, Neom’s high walls will enclose trees, gardens, and other plant life to create an oasis home to the most diverse population of people in the world. The smart city’s residents will live and work in various residential and recreational areas shaped by natural sunlight, shade, and ventilation. It will also use a cutting-edge cloud seeding system to make artificial clouds that produce more rain than is naturally possible in the desert. It will feature the “leading education systems on the planet,” with classes taught by holographic teachers. Robot maids and flying taxis are also planned.
While the plan is undoubtedly grand, it has received its fair share of skepticism. Some architectural critics have suggested that Neom is nothing more than a futuristic pipe dream that will rely on technologies that don’t yet exist. Others have pointed out that the country could be better served by investing its money in infrastructure to help the current economy.
The latest development marks a significant milestone for the project, as it will allow NEOM to begin building the first phase of its housing communities. It will be one of the world’s most significant public-private partnerships for social infrastructure and will accommodate the city’s growing workforce. Alfanar International Development, Al-Mutlaq Real Estate Investment Co, Nesma Holding Co, and Tamasuk Holding Company were chosen to develop the first community.
The contract will see the four local firms develop temporary housing and facilities to house 95,000 workers. This is a significant step in the project’s goal to accelerate the pace of development and will help address Saudi Arabia’s urgent need to support its economy. It will also enable NEOM to meet the demand of its current and future employees and attract skilled talent worldwide. It also reflects the importance of attracting a global workforce to Saudi Arabia as it looks to build a world-class, inclusive, prosperous city.
