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NEOM: Balancing ambition with reality?

From reports of scaling back ambitions for The Line to a significant increase in the project’s workforce, let’s take a look at the $1.5 trillion project NEOM

NEOM

Saudi Arabia’s NEOM project envisioned as a transformative $1.5 trillion megacity on the Red Sea coast, is currently undergoing a period of strategic reassessment. Recent developments highlight both potential scaling back and signs of continued progress, prompting questions about the project’s long-term direction.

According to Bloomberg, Saudi Arabia has revised its plans for the NEOM project, with fewer residents and lower ambitions for development by 2030. Originally aiming for 1.5 million residents in The Line, a futuristic city within NEOM, officials now expect fewer than 300,000 residents to be housed there. This marks a significant scaling back of the project, which is a key part of Crown Prince Mohammed bin Salman’s efforts to diversify the country’s oil-dependent economy. The Line project is facing a scaling back as the NEOM budget for 2024 has not been approved by Saudi Arabia’s sovereign wealth fund due to declining cash reserves, according to Bloomberg.

Crown Prince Mohammed aims to showcase NEOM as a transformative $1.5 trillion development project on the Red Sea coast, with plans for innovative technologies to shape daily life. In addition to The Line, the project includes an industrial city, ports, and tourism developments, with plans to host the Asian Winter Games in 2029 at a mountain resort called Trojena.

Now amidst all of these reports comes another piece of information from Arab News that Saudi giga-project NEOM’s workforce is poised to surpass 200,000 by 2025 as the Kingdom’s ambitious city enters its busiest development phase. 

This significant increase in labour (a 43 per cent rise on the current level) marks a crucial milestone in the Vision 2030 initiative, underscoring the project’s pivotal role in reshaping the Saudi economy. 

NEOM, currently being built in the northwest of Saudi Arabia, has brought together over 100 of the world’s leading construction companies for a two-day industry forum, according to the report.

Addressing the event Nadhmi Al-Nasr, CEO of the giga-project, mentions, “As we go into our busiest ever phase of development, the scale of opportunities across NEOM is monumental. With projects progressing fast across all parts of the region, we are committed to collaborating with globally renowned contractors to achieve the vision of NEOM.”  

Participants gained insights into the plans and scope of upcoming opportunities and toured project sites to witness the ongoing construction firsthand.

The event also facilitated one-on-one meetings, enabling in-depth discussions on specific business prospects as contractors demonstrated their services and capabilities.

The gathering, which featured a mix of firms from Saudi Arabia alongside international companies from Asia, Europe, North America, and North Africa, highlighted current construction progress on-site while emphasising future developments, signifying NEOM’s transition into the next phase of its extensive project portfolio.

The CEO emphasised that as the city’s projects move into a new phase of execution, the need for top-tier construction expertise is crucial to deliver some of the most ambitious development projects the world has ever witnessed.

He further stated that among the ambitious projects is The Line, a 170-km-long city currently being constructed in modular phases, with the first phase expected to welcome residents in 2030.

The forum, furthermore, underscored the critical role of innovation within the industry, emphasising that traditional construction methods are inadequate to meet the scale and scope of the projects in the city of the future.

Moreover, progress made on-site was demonstrated across NEOM, encompassing advancements in the construction of key projects such as The Line, the Spine, Oxagon, Trojena, and an international airport.

Overall, NEOM’s long-term direction remains unclear as per officials who do not wish to be named. The project is likely undergoing a strategic reassessment, potentially prioritising infrastructure development with a smaller initial residential population. Continued news monitoring is essential to understand how NEOM addresses key challenges and navigates its path forward.