The Kingdom of Saudi Arabia understands economic prosperity cannot be based on just one industrial sector, in this case oil & gas. The country needs diversification and modernization to improve the growth and prospects of its economy. The country’s leadership decided in 2016 to establish the ‘Saudi Vision 2030’ to reduce its dependence on oil & gas revenues, build a thriving economy, increase employment and enhance government effectiveness. Building economic cities is a large part of this vision.
Saudi Arabia is investing billions of dollars in building new economic cities in strategic locations across the kingdom. Its growing population and the need to generate more employment have made these economic cities a priority for the leadership.
The cities will decrease the pressure on existing major cities in the kingdom, hosting most of the population and businesses. It will make room for new businesses and allow existing ones to expand. This would allow the population to work in diverse industries. The development of these cities will create new jobs, allow the population to develop new skills, and in due course nurture the country’s economy.
Every city has a specific focus; however, the primary objectives remain the same, growing the national economy, creating more employment for its citizens, regional development, and economic diversification, while attracting domestic and foreign investments. The Saudi Arabian General Investment Authority (SAGIA) is commissioned to attract foreign direct investments into the Kingdom.
NEOM Economic Zone
The NEOM economic zone is one of the most ambitious Smart Cities projects undertaken by the Crown Prince of Saudi Arabia. According to the official statement, NEOM will be the world’s first independent international zone. Its regulatory framework will adopt world-class investment laws to support residents and targeted economic sectors. It will be backed with more than $500 billion over the coming years by the Kingdom’s public investment fund and other investors.
NEOM will also adopt an autonomous judicial system, subject to independent regulations and legislation. It will operate as an independent economic zone in accordance with international best practice. NEOM will be independent of the Kingdom’s existing governmental framework, excluding sovereign laws.
Economic Cities are strategic projects for the Kingdom of Saudi-Arabia to diversify its economy. It could change the destiny of the country and reinvent its economy. Vision 2030 is the driving force behind these efforts to modernize the Saudi economy.