Why Saudi Arabia is scaling back plans for its mega desert project Neom

Come 2030, Saudi Arabia had promised to provide people a city of the future — NEOM. However, those plans have hit a roadblock, with the Kingdom now scaling back its plans.

According to reports, Saudi Arabia has scaled back its plan for ‘The Line’ — a sprawling, futuristic city it plans to contain within a pair of mirror-clad skyscrapers. And as a result of the pullback, at least one contractor has started to dismiss a portion of the workers it employs on the site, according to a document seen by Bloomberg.

We take a closer look at what is The Line and why Saudi authorities are scaling back plans for it.

What’s The Line?

In 2021, Saudi Arabia announced plans of building The Line, a 170-kilometre-long linear city consisting of two parallel, 500-metre-high, linear skyscrapers. The Line is expected to be 33 times the size of New York City.

The Line is part of the country’s audacious and futuristic NEOM project and was originally meant to be home to around 1.5 million residents by the end of the decade, with plans to ultimately increase its full capacity to nine million people.

According to Saudi authorities, the city — stretching from the Red City to the city of Tabuk — would be entirely car-less. Instead, a high-speed rail system would tie it from one end to another.

Concept images of the project were quite sci-fi in nature; a mirrored structure cutting through the desert near crystal blue ocean waters. As per estimates, it was to be 170 km in length, 500 metre in height and having a width of just 200 metre.

Moreover, the plan for The Line is to be powered entirely by renewable energy. Furthermore, it was advertised as a city where residents would have “all daily needs” reachable within a five-minute walk, while also having access to other perks like outdoor skiing facilities and “a high-speed rail with an end-to-end transit of 20 minutes”. Promotional material also touted The Line to be an answer to unchecked and wasteful urban sprawl, layering homes, schools and parks on top of each other in what planners term ‘Zero Gravity Urbanism’.

And the price tag for such an ambitious project was slated at over $500 billion.

So, now what?

A few days ago, Bloomberg reported that the Kingdom had scale back its ambitions for the project, with it now expected to house fewer than 300,000 residents by 2030. Also, officials are expected to complete only 2.4 km of the project by 2030, of the total 170 km.

And as a result of this, one contractor has started to dismiss a portion of the workers it employs on the site.

Commenting on the same, Finance Minister Mohammed Al Jadaan said in December. “The delay or rather the extension of some projects will serve the economy.”

But why the scale back?

There are a multitude of reasons why Saudi Arabia is scaling back its ambition over The Line.
The main reason seems to be the economics of it all. The overall Neom budget for 2024 has yet to be approved by Saudi Arabia’s sovereign wealth fund amid declining cash reserves. According to academics who study it, the wealth fund — known as the Public Investment Fund — could need hundreds of billions of dollars more from the Saudi state.

As Tim Callen, a visiting fellow at the Arab Gulf States Institute think tank in Washington told Wall Street Journal, “It’s mind-boggling the amount of stuff that’s trying to be done here. He estimates the government may need to contribute another $270 billion to PIF by 2030.

And as spending rises, oil revenues have levelled off. The IMF estimated oil prices would need to be above $86 a barrel in 2023 and $80 a barrel this year to balance the government’s budget. Currently, oil prices are drifting at the $81-mark for the past one year.

Another reason, as per a Bloomberg report, is Prince Mohammed’s changing vision for the project. Moreover, several people involved in the project keep changing, describing it as “untethered from reality”.

For instance, when the project was announced and images were released, many had questioned the reality of it. Architect and urban planner Etienne Bou-Abdo had told the Daily Mail, “The 3D images presented are not classical 3D architecture images”, and the designers of the project “have rather called upon video game designers”.

He had further stated that the plan includes “a lot of technology that we don’t have today”. In fact, a number of The Line’s key features related to energy and transport don’t even exist today.

A relief for some?

While the news of the project being scaled back may be embarrassing for Saudi officials, it would serve as relief for environmentalists and human rights activists. This is because The Line, along with NEOM, is believed to have a negative environmental impact.

Environmentalists have said that the megaproject is one of the 15 most pressing issues to watch out for in 2024. In fact, experts stated that the mirrored surfaces of the buildings would be a “death trap” for millions of birds migrating between Europe and Africa. “Birds flying into tall windows is a serious problem, and this is a building that is 500-metre-high going across Saudi Arabia, with windmills on top,” Professor William Sutherland, director of research in Cambridge University’s zoology department, told The Times.

“It’s also kind of like a mirror so you don’t really see it,” Sutherland, who led the study, added. “So unless they do something about it, there’s a serious risk that there could be lots of damage to migratory birds.”

Others have also stated that the project is an attempt at greenwashing — making grand promises about the environment to distract from reality.

Apart from environmentalists, even human rights activists would be heaving a sigh of relief. This is because they allege that the Saudi government has forcibly displaced members of the Howeitat tribe, who have lived for centuries in the Tabuk province in northwest Saudi Arabia, to make way for the project. In fact, at least 47 members of the tribe have been either arrested or detained for resisting eviction, including five who have been sentenced to death, according to a report by the UK-based Alqst rights group.

With inputs from agencies