Saudi Arabia is all set to keep aside 300 billion riyals ($80 billion) for Neom Investment Fund -- the crown prince’s flagship megaproject -- with investment plans for firms willing to operate in the place.
Saudi Arabia Crown Prince Mohammed bin Salman opines that the Neom Investment Fund could potentially expand to 400 billion riyals. While speaking with reporters, Prince Mohammed outlined details on how he plans to finance Neom, which is considered to be one of the largest and most complex construction projects in the world.
Elaborating on his plans, Prince Mohammed also said that the first phase of the project, which runs until 2030, will cost 1.2 trillion riyals, with about half of that covered by the kingdom’s sovereign wealth fund.
While the Saudi officials will seek to raise another 600 billion riyals from other sovereign wealth funds in the region, private investors in Saudi Arabia and abroad. The initial public offering of Neom itself on the Saudi stock market is also on the cards, Prince Mohammed added.
Saudi Arabia is expecting the IPO of Neom will happen around 2024 and could add more than 1 trillion riyals to the size of the kingdom’s market. Earlier, Prince Mohammed announced Neom and his plans to turn an expanse of desert the size of Belgium into a high-tech region. Aiming to attract oreign investment and diversify Saudi Arabia’s oil-dependent economy, the prince billed it as a testbed for new technologies that could revolutionise urban life.
However, Neom has been plagued by setbacks even after 5 years as many stemming from the difficulties of implementing the prince’s grand and ever-changing ideas. In his new announcement, Prince Mohammed mulled for twin buildings that stretch for more than 100 kilometres and contain within them an entire city of 9 million people. With Neom, the Prince also plans to remake Saudi Arabia by increasing its population from around 34 million people currently to 50 million to 60 million by 2030 -- half of those will be foreigners.
According to him, Neom can take care of 10 million people as the capital of Riyadh will be overcrowded if it expands too much. His expectation also suggests that by 2045, around 9 million people will live in the twin buildings. Apart from this, Neom will start engaging major potential investors by the end of this year, he said.
