Saudi Arabia plans $500bn business zone next to Red Sea
Saudi Arabia announced plans for a multi-billion dollar business and industrial zone independent of Saudi law, in a bid to diversify the kingdom's oil-dependent economy.
The plans were announced by Saudi crown prince, Mohammed bin Salman, who said Neom, which will extend across the Egyptian and Jordanian borders, will focus on industries including renewable energy and water, biotechnology, food, advanced manufacturing and entertainment.
The project is dubbed to be the first of its kind to span three countries and adjacent to the Red Sea, Gulf of Aqaba and maritime trade routes near the Suez canal.
It will be backed by more than $500bn over a number of years from the Saudi kingdom and investment from private investors, and span 26,500 sq km.
"Neom is situated on one of the world’s most prominent economic arteries ... its strategic location will also facilitate the zone’s rapid emergence as a global hub that connects Asia, Europe and Africa," said bin Salman in a statement to Reuters.
The Saudi government, its sovereign wealth fund, and local and international investors are expected to put more than half a trillion dollars into the zone in coming years, bin Salman said.
Neom will rely on solar and wind energy, and will form an integral part of bin Salman's Vision 2030 which intends to diversify Saudi Arabia's oil-dependent economy, which has struggled since a fall in oil prices.
In August, Riyadh announced plans to turn an area of untouched Red Sea coastline, the size of Belgium, into a luxury beach resort.
The industrial zone will have "semi-autonomous" legal status and laws "on par with international standards".
There was no immediate comment on the plan from Jordan and Egypt, both of which are close allies of Saudi Arabia.
According to Al Arabiya the first three characters "neo" comes from the Latin for "new". "M" is the first letter of the Arabic word "Mostaqbal" which means "future".