Saudi Arabia’s US$500 Billion NEOM Giga-Project Progressing Steadily, CEO Says

Friday 26 October 2018
Nadhmi Al-Nasr, CEO of NEOM
Riyadh - MENA Herald:

Saudi Arabia’s US$500 billion NEOM project is progressing steadily, according to the newly-appointed Chief Executive Officer, Nadhmi Al-Nasr, who gave an update on the giga project being built on the Red Sea coast.

Al-Nasr made the remarks during a presentation on Thursday, the final day of the October 23-25 Future Investment Initiative conference in Riyadh, where progress in Saudi Arabia’s other two giga projects was highlighted. The two other speakers during the panel were John Pagano, CEO of the Red Sea Development Company; and Michael Reininger, CEO of Qiddiya Investment Company.

Replying to questions during a panel discussion about NEOM’s partnerships, and whether there was any sign of reluctance from international partners recently, and whether he thought it would be a challenge to strike partnerships going forward, Al-Nasr said: “I can tell you what I have been doing for the last three days. I have been leading tens of meetings behind closed doors here with all the partners we have been talking to over the past two years. And the emphasis of all these meetings is commitment and ‘let’s go’ and ‘let’s move on’.

“The business we are in has not been affected .. NEOM is beyond any business. NEOM is the future look of the whole world, the wise people of the world see this as a opportunity for the whole world to turn its vision into reality. I am so proud of our partners.”

NEOM was unveiled by Crown Prince Mohammed bin Salman at the first edition of the Future Investment Initiative (FII) summit in Riyadh last year.

The planned smart city that emerged from the Saudi Vision 2030 comprises a 26,500 square-kilometre area – it will extend 460 kilometres on the coast of the Red Sea – in the far north-west of Saudi Arabia. The project aims to transform the Kingdom into a leading global model in various spheres by focusing on advanced industries and technology, with robots being used for many services and power being generated solely from wind and solar energy. The city is supposed to operate independently from the “existing governmental framework” with its own tax and labour laws and an “autonomous judicial system”, according to initial announcements.

 

CONSIDERABLE PROGRESS

Considerable progress has been made on the NEOM project over the past year, Al-Nasr said.

“Many people, most of you may be are saying ‘what has happened since last year?’” he told the conference.

“I can tell you that over the past 12 months there has been massive work. There is a team working day and night, going through the steps that we have to do to bring NEOM on the ground.

“Planning is the name of the game,” Al-Nasr said. “It is not a programme or a project that we can push through without doing the planning and the right process.”

He said that over the past 12 months the management focused solely on the strategy.

“Phase 1 is behind us... defining the vision, explaining the objectives and now in Phase 2 we are identifying all the economic sectors of NEOM, all the living standards, all the living style and community. We are not just building an economy, we are building cities, towns.”

NEOM is viewed as the new economy supporting the main economy of Saudi Arabia, Al-Nasr said. The project has the support of the government and Crown Prince Mohammed bin Salman.

The primary objectives of the project, he said, included reducing the leakages of the Saudi economy, to turn it into a home to global businesses and to attract the brightest talent by offering the most attractive living environment in the world. Such a great commitment would obviously require time. After all, the vision is to build NEOM as a “country within a country, an economy within an economy,” he added.

A total of 16 economic sectors had been identified as the key drivers for NEOM, tourism being the dominant one, he said.

Each of the 16 sectors “is being reviewed, studied, challenged, [in terms] of business plans and exploring what it takes to make this sector.

“Hundreds of NEOM team members, among them consultants; among them the whole globe are working with us, looking at the details of the details of every sector. At the end of this phase, which is around May or June of next year, we will be able to say which of those are firm, concluded and approved. And for those approved, we move to the next step which is designing and planning that will lead us into the execution and construction....

“We learnt a lot over the past year and we have incorporated what we have learnt in the first phase of our strategy,” Mr Al-Nasr said. Despite progress, he acknowledged that some challenges were formidable, yet none posed any hindrance. “NEOM is a place where we challenge ourselves and come up with greatest ideas” to overcome them.

Tourism, one of the 16 sectors, is a leading one, he said.

“NEOM is one of the richest historical regions in the Kingdom and in the whole region. It is the meeting point of thousands of years of history of this region.”

 

‘WE TAKE EVERY INTEREST SERIOUSLY’

He said a typical day at NEOM offices can involve meetings with local and international construction contractors to discuss what it would take to build the city. This can be followed by a strategy meeting on electrical cars, talking to three global technology drivers that specialise in this business, to see how they can develop that in NEOM, followed up by looking into the operation of IT, knowledge sharing and talking to investors

“Basically we are an operation of 24 hours a day, 7-days a week to chase and compete with time to make sure we are on deadline,” Al-Nasr said.

“Our focus is to approach every potential investor that has interest to join us and be a partner of NEOM. We have no limits, no constraints, no limitations.

“At this stage we have been calling on everyone here who has interest in reaching us, approaching us, expressing interest in any business we have in NEOM, we take every interest seriously.”

He expressed hope that by this time next year, the NEOM presentation at the third edition of FII would be held at the NEOM site.

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