Saudi Arabia’s new futuristic desert city

Saudi Arabia has unveiled plans to build a $630bn desert megacity that will run on green energy | WATCH VIDEO

New futuristic city for Saudi Arabia. Picture: Getty

Saudi Arabia has unveiled plans to build a $630 billion AUD megacity that will run on alternative energy and have its own laws.

In a project that forms a key part of the kingdom’s plan to diversify its economy, the zone of Neom will cover 26,500 square kilometres of “totally untouched” land and will power itself with wind and solar energy.

Neom, which stands for new future, will span Saudi Arabia, Egypt and Jordan along the Red Sea coastline and will have its own tax and labour laws as well as an autonomous judicial system.

Plans for the futuristic city, which will also feature the use of driverless cars, drones and other robots, were unveiled by Crown Prince Mohammed bin Salman at the Future Investment Initiative in Riyadh. It was among a host of significant announcements made on the first day of the high-profile event hosted by Saudi Arabia’s sovereign wealth fund, the Public Investment Fund.

The event has already been nicknamed Davos in the Desert after attracting chief executives of some of the world’s biggest companies, investors, policymakers, economists and financial advisers. It has three pillars: shifting centres of power, the new investment paradigm and innovation for a better world.

On the first day more than 3,500 delegates from 60 nations were told that:

- Plans for the $3.4 trillion Saudi Aramco float - a key element of the kingdom’s Vision 2030 plan to overhaul its economy - were on track with a targeted listing in 2018;

- The Public Investment Fund had confirmed its dollars $20 billion investment into a new infrastructure fund set up with Blackstone, the US private equity giant, earlier this year;

- The Public Investment Fund’s mandate had been extended to consider many new industries that could help diversify the kingdom’s revenue stream and provide more and better quality jobs in the kingdom.

The key announcement yesterday was the ambitious plan for Neom, a project that is being personally driven by the crown prince, who has made it clear he wishes to transform the ultra-conservative nation since his appointment in June.

Saudi Crown Prince Mohammed bin Salman attends the Future Investment Initiative conference in Riyadh. Picture: AFP

As he announced the plans for Neom he pledged that Saudi Arabia would “end extremism soon” and would return to what it was before, a country of “moderate Islam that is open to the world and to all religions”.

Stephen Schwarzman, who runs Blackstone, said that although he felt like he was speaking at a summit that “felt like a pep rally”, he was “in awe” of the crown prince and his vision for Neom, which will be partly funded by the Public Investment Fund as well as international investors, possibly including Blackstone.

Klaus Kleinfeld, the former chairman and chief executive of Arconic and Alcoa, has been appointed to lead the Neom project.

Masayoshi Son said that his Softbank Vision Fund was considering taking a “large stake” in Saudi Electricity as part of an agreement with the Public Investment Fund to develop solar capacity in the Neom project. He said that “God had been good to Saudi Arabia” as it had been blessed with oil as well as sunshine and the energy from it.

Mr Son’s Vision Fund has already raised more than $153 billion to invest in smart technology such as artificial intelligence and robotics and counts Saudi Arabia as the largest investor in the fund. He said that Neom could end up having more robots than people and said of the crown prince that he was a leader “with passion, a young age, a great vision and a little bit of money, which also helps - it is a fantastic combination and I think we are going to succeed”.

Tony Blair said that it would have been unthinkable only a few years ago to imagine Saudi Arabia hosting an event of this nature.

He said that it was the “most important and exciting thing to happen in the region”, adding that it was more important than ever for global leaders to think of inter-connected solutions to challenges at a time of rising populism and protectionism.

The Times