Saudi Arabia is making adjustments to its plans for the NEOM project, a desert development project aimed at reducing the country’s dependence on oil exports. The ambitious project, which includes the construction of a megacity, has faced challenges with its 2024 budget yet to be approved.
The downsizing of The Line project reflects the financial reality of the NEOM project, which has an estimated cost of 1.5 trillion USD. Funding for the project primarily comes from the Public Investment Fund (PIF) led by Crown Prince Mohammed Bin Salman. The fund’s cash reserves have decreased to $15 billion, its lowest level since 2020.
Despite these challenges, other aspects of the NEOM project are progressing as planned. The luxury tourist island Sindalah is expected to open this year, and plans for the Winter Olympics in Trojena in 2029 are still in place. The project also includes the development of new technology, with PIF investing in solar and wind farms to create green hydrogen and reduce fossil fuel usage.
Overall, while the NEOM project may be facing setbacks, its long-term goals remain intact as Saudi Arabia continues its efforts to diversify its economy and reduce its reliance on oil exports.
