Saudi Arabia has redirected its spending away from big-scale urban projects in its Vision 2030 into sectors that promise more value. Since last year, the program, the Vision 2030, has undergone a significant review following a US$8 billion write-down at the end of 2024.
The kingdom’s public investment fund has scaled down projects significantly, such as the US$500 billion 170 kilometer-long flat city the Line in the northwestern Neom region. The construction cost, the construction contract awards by Saudi authorities had plunged by 72% year-on-year during the second quarter of 2025, according to an investor briefing issued by Kuwait-based asset manager Kamco Investment in July.
The public investment fund sovereign wealth fund is expected to soon announce a revision to Saudi Vision 2030 that was first unveiled in 2016. Vision 2030 is an ambitious project launched by Saudi’s Crown Prince, Mohammed bin Salman, to diversify its oil-dependent economy. Saudi officials have already identified artificial intelligence, technology, logistics and transport, mining and tourism as NEOM’s new focal areas. NEOM was not mentioned in the 2026 budget announced in early December by Saudi Finance Minister Mohammed Al-Jadaan.
This first omission of NEOM since the project was unveiled in 2017 showed that the country’s mega projects were being recalibrated to ensure that they are delivering what they are meant to deliver, the finance minister said. The futuristic city of NEOM was originally slated to host the 2029 Asian Winter Games.
Within NEOM, the Trojena resort has been positioned as a mountain tourism destination, including facilities for winter sports and luxurious flats. However, the hiccups at the Trojena resort forced Saudi Arabia’s Olympic committee to announce the indefinite postponement of the games in January 2023, highlighting the challenges that Jeddah may also face in delivering other mega projects, including Expo 2030 and 2034 FIFA World Cup.
In the past few months, Saudi Arabia has frozen rents, opened property ownership for foreigners, relaxed liquor laws, and freed its stock market to investors anywhere. The latest reforms are directed towards transforming Saudi Arabia into an investment destination and better competing with Dubai. To direct believes that more foreign cash could help companies expand and drive infrastructure financing in the government’s investment more critically to alleviate financial pressure as well. Saudi Arabia has been facing a fiscal shortfall since 2022, as it is running a current account deficit for five consecutive years.
