Saudi Arabia Spent $500B to Build a Futuristic City in the Desert, Now Reality Is Setting In

By: Sam Watanuki | Last updated: Apr 24, 2024

Saudi Arabia’s plan to spend over $500 billion on a futuristic, eco-friendly city in the desert may not turn out quite like it was once envisioned.

The reality of such an extensive financial project has begun to cause concern among investors as work slows down and the Saudi Government is yet to announce Neom’s 2024 budget.

The Futuristic City Shrinks in Size

At the core of the Neom, an extensive development project launched by Crown Prince Bin Salman, is a futuristic city once predicted to run over 105 miles long known as The Line.

An image of the Saudi King and his Son

Source: Royal Private Office

However, the plans for the desert metropolis appear to have been scaled back, with rumors suggesting the city will only stretch for a mile and a half by 2030.


Scaling Down on Prince Mohammed’s Project

Prince Mohammed, the son of the King of Saudi Arabia, Salman, is the face of Neom and the wider Vision 2030 project, which aims to restructure the country to ensure everyone has the opportunity to succeed.

An image of the King of Saudi Arabia, Salman

Source: Wikipedia/iStock

The prince has claimed he wants to revolutionize the Saudi nation and reduce its dependency on oil.

Neom’s Plans For the Future

Alongside the megacity, Neom’s other projects include an extensive industrial city, large ports, and tourism developments.

A large oil factory is pictured in Saudi Arabia

Source: @Pulse/Linkedin

The region is even set to host the 2029 Asian Winter Games at Torjena, a luxurious mountain resort.

$1.5 Trillion Project

Originally, Saudi Arabia pledged to commit at least 500 billion to Crown Prince Mohammed bin Salman’s Vision 2030 project.

An image of the Saudi government during a meeting

Source: @Islamiyatsb/X

Further investment coming from local and overseas investors brought the project budget to around $1.5 trillion.

Work Began in the Desert Back in 2017

Work on the construction of the megacity began back in 2017.

An image of a large desert during a clear day

Source: Freepik

However, reports suggest that excessive spending of the nation’s money on The Line has been deemed controversial by high-ranking members of the Saudi government, per Bloomberg.


Saudi Government Forced to Lower Estimations

Initial projections suggested that over 1.5 million people would already live in the futuristic city by 2030.

An image of how the futuristic megacity is predicted to look when finished

Source: Neom

However, due to recent financial problems, officials have projected that the city could house as few as 300,00 people.


Saudi Government Yet to Announce 2024 Funding

One of the major problems surrounding the project is the kingdom’s sovereign wealth fund has yet to approve Neom’s 2024 budget.

A large amount of American dollar bills sit stacked on a table

Source: Freepik

According to the experts, the reality of spending trillions of dollars has begun to cause concern within the Saudi government.


Companies Begin Pulling Workers From the Site

According to Bloomberg, as a result of the pullback, at least one company has begun dismissing its workers from the site.

An image of where the Neom project is taking place

Source: Neom

This appears to have happened after officials claimed that some of Neom’s other projects would be delayed well beyond 2030.


More Time is Needed to Build

Speaking in December, Finance Minister Mohammed Al Jadaan said more time is needed to “build factories, build even sufficient human resources.”

An image of two men as they discuss construction plans

Source: Freepik

He continued, “The delay or rather the extension of some projects will serve the economy.”


Further Problems Surrounding the Project

It’s not just finances that have dampened the megacity; in recent years, several ethical issues have made headlines on numerous occasions.

An image of the Crown Prince of Saudi

Source: @His Majesty King Mohammad bin Salman bin Abdulaziz Al Saud/Facebook

From Prince Mohammed’s alleged involvement in the killing of Washington Post journalist Jamal Khashoggi to rumors that Saudi officials killed several members of a tribe who refused to leave their ancestral lands, the entirety of the Neom project has been tainted long before it’s even finished.


US Journalist Shares Thoughts on Saudi City

In 2021, US journalist Robert Worth shared his thoughts on a video released by Neom which described the prospects of its futuristic city.

An image of a reporter holding a large mic as she writes down notes in her book

Source: Freepik

“To watch the crown prince’s promotional video is to be immersed in a distinctively Saudi form of arrogance, blending religious triumphalism and royal grandiosity.”


Financial Strains and Adjustments

As Neom’s grand vision confronts reality, the financial strains are becoming increasingly apparent. With the Saudi sovereign wealth fund still undecided on Neom’s 2024 budget, the project’s financial sustainability is in question.

A black suitcase full of American cash

Source: Shutterstock

The ambitious scope of the city, initially set at $500 billion now faces potential cutbacks, delaying some of the most innovative features planned for the urban development (via the WSJ).


Technological Hurdles in Desert Construction

Implementing cutting-edge technology like cloud seeding and robotic services in Neom poses unique challenges.

Several robots sit in a row typing on computers

Source: LinkedIn

The harsh desert environment tests the limits of current technology, with sand and heat complicating maintenance and operation. These hurdles must be overcome to realize the high-tech oasis Saudi officials have envisioned.


Environmental Concerns in Desert Development

Building a futuristic city in the desert raises significant environmental concerns. The construction of Neom disrupts local ecosystems, and the sustainability of such a large-scale development is under scrutiny.

A jar of coins with a plant growing from the center.

Source: Michelle Henderson/Unsplash

Efforts to minimize ecological impact are critical to the project’s acceptance and success.


Delays in Core Infrastructure

Neom’s infrastructure, crucial for its development, is lagging. The delay in establishing essential utilities and transport links hampers the project’s progress, pushing back the timeline for becoming a fully operational city.

Multiple tower cranes stand tall against a clear blue sky at a bustling construction site with various construction stages visible

Source: Wikimedia Commons

These delays could have ripple effects on investment and confidence in the project’s completion.


Labor Dynamics and Employment Shifts

The scaling back of Neom has led to fluctuations in employment, affecting both local and international workers (via FirstPost).

A man walks through his workplace while wearing a yellow construction hat.

Source: Jon Tyson/Unsplash

Reports indicate changes in labor needs, with some companies reducing their workforce. This impacts not only the project’s timeline but also the livelihood of thousands involved in construction.


Impact on Local Economies

Neom’s construction impacts surrounding communities economically and socially. While some local businesses benefit from the influx of workers, others suffer from the changes brought by such a massive project.

An upward angle view of a construction scaffolding made of metal poles and wooden planks

Source: Brett Jordan/Unsplash

Balancing economic benefits with community welfare is a significant challenge for the Saudi government.


Attracting Global Talent to Neom

Neom aims to be a hub for innovation, requiring a skilled global workforce. However, attracting this talent is challenged by logistical, cultural, and professional hurdles.

A group of construction workers are pictured dressed in orange hi-vis vests

Source: Freepik

Ensuring competitive benefits and a high quality of life is essential for drawing the expertise needed to fulfill Neom’s tech-driven aspirations.


Cultural Integration and Social Dynamics

Integrating a futuristic city like Neom into Saudi Arabia’s conservative cultural landscape presents its own unique set of challenges.

Princesses of Saudi Arabia speaking outside wearing sunglasses

Source: Adobe Stock

The project’s progressive features may clash with traditional values, necessitating sensitive handling to foster social acceptance and integration.


Surveillance and Security Measures

The high-tech infrastructure of Neom includes extensive surveillance capabilities, raising privacy concerns (via The New York Post).

A multitude of black surveillance cameras mounted on a dark brick wall in a grid pattern, symbolizing extensive security monitoring

Source: Lianhao Qu/Unsplash

While intended to enhance security, the potential for surveillance to be used for authoritarian purposes has alarmed human rights observers, echoing broader concerns about privacy in the digital age.


Foreign Investment and International Relations

Neom’s success heavily relies on foreign investment and international cooperation.

Two people shake hands while exchanging cash

Source: wutzko/Canva

The project’s ability to attract global capital is important but faces scrutiny due to geopolitical tensions and internal challenges within Saudi Arabia, including human rights issues (via The New Arab).


Media Influence and Public Perception

Neom’s portrayal in the media significantly affects public perception. Positive coverage can attract investment and residents, while negative reports may deter both.

A reporter is pictured writing down notes in her journal

Source: Freepik

Managing this aspect is crucial for maintaining momentum and ensuring the project’s image aligns with its ambitious goals.


Revising Goals for the Future

Given the array of challenges, Neom’s initial goals are being reevaluated. Updated projections consider current realities, focusing on achievable targets.

The silhouette of several construction workers and a construction crane against an orange sunset sky

Source: Shivendu Shukla/Unsplash

This recalibration could help maintain stakeholder trust and ensure the project’s long-term viability in the evolving landscape of global city development.