Saudi Arabia building news cities out of sand to move economy away from oil

Saudi Arabia announced one new project last week that will span 34,000 square miles—about the size of Belgium—of the Red Sea coastline and adjacent islands.
By Mae Owen | Aug 07, 2017
Construction is under way across the deserts of Saudi Arabia as construction crews erect whole new cities out of the sands. The kingdom is pouring public funds into new city construction atop thousands of square kilometers of sand as it strives to breathe life into new commercial activities that will create jobs and revenues outside of its traditional economic mainstay, oil.

Saudi Arabia announced one new project last week that will span 34,000 square milesabout the size of Belgiumof the Red Sea coastline and adjacent islands. Developers will build this entire area into luxury beach resorts. The first phase is expected to be completed by 2022.

This is on top of other plans under way for a number of new "economic cities" that each specializes in an industry such as logistics, tourism, or finance; as well as a new entertainment city and a $10 billion financial district. In addition, the kingdom is planning a new city called Al Faisaliyah to be situated west of Mecca. It will be almost as large as Moscow and will have an airport and seaport. Completion might not be until 2050.

Plans for some of the economic cities are a few years old. Inadequate investmentparticularly after oil prices declined over the last decadekept them from getting off the ground.
"The overall progress with the economic cities has been very slow, even before the collapse of the oil price," said Monica Malik, chief economist at Abu Dhabi Commercial Bank PJSC. "Since then, the pace of development has moderated even further with a number of projects being placed on hold."
An April 2017 Saudi blueprint, "Saudi Vision 2030," affirms that the government will work to "revamp" and "salvage" these and other projects that "did not realize their potential."

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