Saudi Arabia Scales Back Vision 2030 Gigaprojects Amid Oil Price Slump
Riyadh shifts focus from bold megadevelopments to pragmatic investments as oil at $60 a barrel drives cost discipline
Saudi Arabia is recalibrating its flagship Vision 2030 agenda in light of persistent oil price weakness and ballooning development costs.
Sources say the kingdom’s sovereign wealth fund, the Public Investment Fund (PIF), is pivoting away from large-scale real-estate gigaprojects valued in the hundreds of billions of dollars and re-allocating capital into technology, logistics and mining sectors.
Introduce the transformative megacities, luxury resorts and massive entertainment zones that once defined the Vision 2030 narrative – projects such as the linear city known as The Line, the desert development Neom, and the mountain resort Trojena – have all been subject to scaling back or major scope revisions.
The Line, for example, which initially envisaged stretching over 100 miles and accommodating up to nine million residents, is reportedly now trimmed to just a few miles and a target of 300,000 residents.
An adviser to Crown Prince Mohammed bin Salman was candid that “we spent too much.
We rushed at one-hundred miles per hour.
We are now running deficits” and that the kingdom must “re-prioritise.” Indeed, a source familiar with PIF’s strategy disclosed that the fund’s new five-year plan will centre on near-term returns in minerals, artificial intelligence, data centres and religious tourism rather than speculative real-estate monuments.
The shift is underpinned by macro-economic strain.
Vision 2030 had implicitly assumed oil prices above one-hundred dollars a barrel; instead, Brent crude languishes near sixty dollars.
Combined with global investor caution and high borrowing costs, this has prompted widespread reassessments of timelines and budgets.
According to reports, the PIF has already written down billions of dollars in project valuations and cut funding for some high-risk ventures.
Though the repositioning reflects sober realism, Riyadh maintains that the broader diversification strategy remains intact and vital.
The government emphasises that sectors such as technology, logistics and mining are now the primary vehicles for long-term growth.
It notes that some infrastructure related to the forthcoming 2029 Asian Winter Games and the 2034 FIFA World Cup will still proceed on schedule, signalling that the kingdom remains committed to strategic delivery.
By acknowledging financial headwinds and consciously trimming ambitions, Saudi Arabia may yet preserve the core of its Vision 2030 transformation – albeit at a more measured pace and with heightened focus on projects that promise return on investment rather than architectural spectacle.
Sources say the kingdom’s sovereign wealth fund, the Public Investment Fund (PIF), is pivoting away from large-scale real-estate gigaprojects valued in the hundreds of billions of dollars and re-allocating capital into technology, logistics and mining sectors.
Introduce the transformative megacities, luxury resorts and massive entertainment zones that once defined the Vision 2030 narrative – projects such as the linear city known as The Line, the desert development Neom, and the mountain resort Trojena – have all been subject to scaling back or major scope revisions.
The Line, for example, which initially envisaged stretching over 100 miles and accommodating up to nine million residents, is reportedly now trimmed to just a few miles and a target of 300,000 residents.
An adviser to Crown Prince Mohammed bin Salman was candid that “we spent too much.
We rushed at one-hundred miles per hour.
We are now running deficits” and that the kingdom must “re-prioritise.” Indeed, a source familiar with PIF’s strategy disclosed that the fund’s new five-year plan will centre on near-term returns in minerals, artificial intelligence, data centres and religious tourism rather than speculative real-estate monuments.
The shift is underpinned by macro-economic strain.
Vision 2030 had implicitly assumed oil prices above one-hundred dollars a barrel; instead, Brent crude languishes near sixty dollars.
Combined with global investor caution and high borrowing costs, this has prompted widespread reassessments of timelines and budgets.
According to reports, the PIF has already written down billions of dollars in project valuations and cut funding for some high-risk ventures.
Though the repositioning reflects sober realism, Riyadh maintains that the broader diversification strategy remains intact and vital.
The government emphasises that sectors such as technology, logistics and mining are now the primary vehicles for long-term growth.
It notes that some infrastructure related to the forthcoming 2029 Asian Winter Games and the 2034 FIFA World Cup will still proceed on schedule, signalling that the kingdom remains committed to strategic delivery.
By acknowledging financial headwinds and consciously trimming ambitions, Saudi Arabia may yet preserve the core of its Vision 2030 transformation – albeit at a more measured pace and with heightened focus on projects that promise return on investment rather than architectural spectacle.
