Saudi Arabia’s Economy Minister has dismissed recent claims suggesting a reduction in the scope of the kingdom’s $1.5 trillion NEOM megaproject. Despite reports indicating potential scaling back, Faisal Al Ibrahim assured that all projects are proceeding as planned. Speaking to CNBC at the World Economic Forum’s special meeting in Riyadh, he emphasized, “We set out to do something unprecedented, and we are delivering on that promise.”
Reports emerged in early April from Western media that The Line, a proposed glass-walled city stretching 105 miles across the desert by 2030, might only extend 1.5 miles by that time, a 98.6% reduction. Bloomberg’s initial report, citing anonymous sources, also mentioned that the expected population target of 1.5 million by 2030 had been reduced to 300,000. These adjustments were reportedly due to financial concerns surrounding NEOM, part of Saudi Arabia’s Vision 2030 initiative aimed at economic diversification. Additionally, Bloomberg noted that the Public Investment Fund, the kingdom’s sovereign wealth fund, had yet to approve NEOM’s 2024 budget.
Al Ibrahim reiterated the kingdom’s commitment to the original plans, albeit with a focus on optimizing economic impact. He stated, “We see feedback from the market and increased investor interest, and we prioritize optimal economic impact.” He highlighted the importance of managing the kingdom’s economic growth without overheating it or compromising national interests.
“For NEOM, the projects are continuing at their intended scale without any changes,” he affirmed. He explained that the projects are designed to be modular and are intended to deliver significant impacts across specific sectors. Addressing concerns about investor confidence, Al Ibrahim mentioned that investor interest in NEOM’s various projects is growing.
“These sectors are being built from scratch and require substantial investment from both the government and the sovereign wealth fund,” he noted. The minister emphasized that the projects will be executed in a manner that aligns with their priorities, ensuring economic returns and minimizing risks of overheating the economy.
