Why Neom, Saudi Arabia's dream city in the desert, has a grainy future

Saudi Arabia’s $1.5 trillion Neom project is crumbling.

According to a report_,_ the brainchild of Crown Prince Mohammed bin Salman (MBS) – which is part of his larger Vision 2030 strategy – has run into serious trouble.

Overrunning costs, missed deadlines and an internal audit have thrown the future of the project into doubt.

The latest development comes months after the longtime CEO of the project_,_ Nadhmi al-Nasr, quit without giving any reason.

MBS’s absence too is raising eyebrows.

But what do we know?

Let’s take a closer look:

Skyrocketing costs

According to a report in The Wall Street Journal, the cost of Neom has skyrocketed to $8.8 trillion – an incredible figure even for the deep-pocketed Saudis.

For reference, that figure is around 25 times more than the Kingdom’s annual budget.

Though the Saudis have poured $50 billion into Neom, not much headway has been made.

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The first phase of the project, which is slated to open in 2025, itself is estimated to cost around $370 billion.

Shrinking ambitions

As per The Times of India, The Line was set to be a 170 kilometre city with 1,600 foot tall skyscrapers.

As per NDTV, the project was to supposed to be within two parallel skyscrapers taller than the Empire State Building.

Now projected to open by 2024, the length of The Line has been reduced to just 2.4 kilometres.

However, MBS has refused to lower the skyscrapers’ height to 1,000 feet to cut costs.

“We’ll start to go vertical—hopefully—at the end of this year,” The Line’s development head Denis Hickey was quoted as saying at the World Economic Forum.

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Audit raises red flags

As per The Times of India, auditors have also found “evidence of deliberate manipulation” by “certain members of management."

Hotel rates have been overstated to justify increased spending – the price of hiking lodges, for example, have been increased from $489 to $1,866 per night.

Meanwhile glamping site rates were raised three-fold – from $216 to $794.

This has reportedly been done with help from pricey McKinsey consultants.

Officials reportedly tried to hide their efforts at manipulation.

The WSJ quoted from an email showing that Antoni Vives, who was put in charge of Neom’s coastal resort called Sindalah, told consultants that “we must not proactively mention cost at all” before a key meeting.

This comes even as McKinsey is making a killing.

The WSJ reported that the consultancy firm has made over $130 million a year for its services.

A McKinsey spokesperson has denied that the firm “has been involved in the manipulation of financial reporting.”

Neom’s coastal resort Sindalah is a royal mess.

As per Futurism, though officials held a high-profile launch party in October with celebrities such as actor Will Smith and NFL quarterback Tom Brady in attendance, its golf course and hotels are yet to open to the public.

This has essentially left workers stranded – and with nothing to do.

CEO quits

In November, the project’s longtime CEO quit.

Though al-Nasr gave no reason, the move came on the heels of a documentary that claimed that tens of thousands of foreign workers had already died during Neom’s construction.

It remains to be seen if the project can overcome its many troubles – or if MBS will pull the plug.