Saudi Arabia’s Crown Prince Taps International Markets for Funding Neom Megacity Project

Crown Prince Mohammed bin Salman’s Neom project in Saudi Arabia is set to issue its first bonds, potentially raising up to $1.3 billion to fund its development. The megacity project, with an estimated cost of $500 billion, is looking to sell Islamic bonds, known as sukuk, to raise funds. This is part of Saudi Arabia’s efforts to diversify its economy away from oil and into other sectors, including technology.

The project’s centerpiece is The Line, a futuristic city within mirrored skyscrapers that aims to be sustainable and emissions-free. Other elements of the Neom project include a sustainable port on the Red Sea, a ski and adventure resort, and a luxury island called Sindalha. However, despite most of the funding coming from Saudi Arabia’s sovereign wealth fund, PIF, there are concerns about rising costs and the need for additional funding to fully realize the ambitions of Vision 2030. To finance its development, the project has started borrowing money, reflecting the challenges of executing such large-scale projects.