Digital rendering from Nome's the Line Project in Saudi Arabia
The line, NEOM
Dubai, United Arab Emirates -Saudi -Arabia's sovereign asset fund, his flagship of 500 billion US dollars, the Line.
The public investment fund has handled consulting companies in order to carry out a strategic review of the feasibility of the 105 mile linear city in Niam-self-self-self-self-self-self-self-development in Saudi Arabia.
NEOM confirmed the news that Bloomberg reported for the first time and said that strategic reviews are “usual practice” for long -term mega projects.
However, the step comes in the middle of the global examination of the ambitious infrastructure agent Saudi Arabia and growing pressure on public finances.
NEIM did not describe what the review would concentrate on, but it is likely that the technical feasibility, financing and the economic effects will be examined, “said Tim Callen, visiting scholarship holder at the Arab Gulf States Institute.
“I think these are all areas in which people have had questions in the past. Is the technology there to actually achieve what NEOM wants to do? Are the costs of development too high?
The location of the line in the northwestern desert of Saudi Arabia is currently a spacious location full of cranes and stacking drivers and a recently built street. Long parallel traces cut through the sand and include the spine of what planners will be a high-speed rail system.
Construction of the line project in Saudi -Arabia Neom, October 2024
Giles Pendleton, the line at NEOM
A high-tech city between two Glasicscrapers is supposed to survive more than 1,600 feet, which the Saudi government finally houses 9 million people.
The project is just one of the hyper-futuristic places planned in NeiM, the idea of the Saudi crown prince Mohammed bin Salman and a region that hopes to bring millions of new residents to Saudi Arabia and to revolutionize life and technology in the country.
It is a core column of Vision 2030 that aims to diversify the Saudi economy from the oil revenue and to create new jobs and industries for their emerging young population.
The cost of NEOM total was estimated at 1.5 trillion dollars. After many years of apparently unlimited expenses, an abrupt shift began to see in 2024 when the Saudi budget deficit increased and the price of an oil fell far below what the kingdom needed to compensate for its budget.
“It is clear that if the oil prices, as you have already said, are around 70 US dollars per barrel, this is a completely different environment than if they are 100 US dollars per barrel, where they were on average in 2022,” said the Callen of the Arab Gulf State Institute. The international benchmark Brent Rohs acted on Friday at 2:15 p.m. London period of $ 70.15 per barrel.
“As many of these projects have to be re -evaluated and re -evaluated. Does this mean that neon will not happen? No, I think NEOM will definitely be continued in some form. But whether it is on a smaller scale and over a longer period than originally intended, it is very likely that I am.”
“Yes, man” mentality
There was also a lot of criticism of what some in the kingdom describe as “Ja -Man” mentality at NEOM, in which consultants and consultants should provide highly optimistic forecasts and costs for the introduction of forecasts in order to stay in the favor of their employers.
“I do not think that the expectations of the leadership at the project level have been managed well,” Tarik Solomon, emeritus chairman of the American Chamber of Commerce in Saudi Arabia, told CNBC.
“In order for a project of this scale to be successful, it must adapt to the market controls and build trust.”
Solomon praised Neia and the line as “one of the brave ideas that I saw that actually came into execution,” added that “the architecture and consulting companies involved play an important role here and that they should have more owners and responsibility.”
Together with the planned “assessment” of the line, NEOM is planned as a whole job cuts, a consultant who works for the project told CNBC.
“They finally start making financially well -founded decisions,” said the consultant, who asked to remain anonymous due to restrictions on the restrictions on the conversation.
NEOM did not immediately answer a CNBC request for comments.