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Neom: The tip of the tech iceberg in the Saudi desert

What is known about plans for Saudi Arabian smart city Neom could be just the tip of the iceberg

Even if only a fraction of what is planned gets implemented in Saudi Arabia’s Neom smart city project, it may still provide a huge boost to the country’s high-tech ecosystem.

Robert Mogielnicki, senior resident scholar at The Arab Gulf States Institute in Washington, says: “If you click through all the different components of the Neom website, what you see is the tip of the iceberg concerning the project’s evolution over the past few years.

“Several other companies and initiatives that have been created within the broader Neom megaproject are harder to find.”

Many of the new companies and initiatives have a strong technology focus. Whether they develop renewable energy, autonomous vehicles or Industry 4.0 infrastructure, they will certainly rely on computer and communications technologies – and a lot of it will come from exports brought in from outside the region.

In many cases, technology will have to be used in new ways to support some of the more imaginative parts of the project, such as a world-class ski resort in the desert or a city perched high up that needs an adequate supply of desalinated water. 

“Neom is not exactly where it was when it was announced back in 2017,” said Mogielnicki, who has been following the project from its inception. “When it was announced in 2017, it was supposed to incorporate Jordanian and Egyptian territory. While that was big news back then, the transnational dimension just faded away over a couple of years, and Neom is for now confined to Saudi Arabia. But the idea is to make Neom a global hub.”

He says he noticed what appeared to be a new phase of development around 2021 and 2022, when technology came into Neom in a big way and distinct sub-projects or dimensions emerged. Perhaps the biggest and most talked about was The Line, an experimental approach to urban development, which, according to an article that appeared in Bloomberg on 5 April 2024, is now being scaled back. The original plans called for The Line to cover a 170km piece of desert land along the coast. Observers are now saying that only 2.4km will be completed by 2030.

Ski resort

One part of Neom that must go forward is Trojena, which will be a ski resort in the Neom mountains. Even though Trojena doesn’t yet exist, it won the rights to host the 2029 Asian Winter Games, which makes it very unlikely the country will scale back there. 

The resort will have world-class wellness programmes, said Philip Gullett, executive director of Trojena, in an interview published on the project’s web page. This will include high-tech medical treatments, recovery, training, human improvement and performance. 

Oxagon, a port city, is planned to have a strong focus on automated industrial processes and Industry 4.0 technologies. According to the project scope, the city will use a proprietary digital supply chain orchestration platform that will provide Neom with a network to access digitised port, logistics and rail delivery systems. 

Another ambitious development, Sindalah, will be a luxury island on the Red Sea, which the Neom website says will be “the first physical showcase of Neom”.

The Neom project has already given rise to a number of spinoff companies. Tonomus is the first, a company that says it collects data with user consent. Another is Enowa, with the mission to deploy best-in-class renewable energy technologies across Neom. They will have a lot of work to do, given that project planners have suggested Neom will be 100% powered by renewable energy.

Topian was launched at the end of 2023 to revolutionise the food system in Saudi Arabia by producing and distributing food in a more sustainable manner. 

“What we’ve seen emerge in 2023 and early 2024 has been an incredible proliferation of sub-development projects,” said Mogielnicki. “About a dozen of them have emerged. These projects are described as destinations, and some of them have a particular focus, like an exclusive golf destination. Many have a heavy focus on high tech. The planners are trying to promote this notion that these destinations will offer visitors and residents the next generation type of living.”

Neom is a development project, but it’s also a company, owned by the public investment fund (PIF), the sovereign wealth fund of Saudi Arabia. There may be share offerings in the future, with the hope being that as private investor interest increases, the government can decrease its financial responsibilities.

“Recently, the PIF has been making a much more aggressive push into technology-focused sectors,” said Mogielnicki. “For a long time, the Public Investment Fund and other Gulf sovereign wealth funds have invested in public equities of technology-focused companies. That’s nothing new. But more recently, there’s been a concerted push to use the PIF to enhance the position of Saudi Arabia and some of the big projects within Saudi Arabia as this emerging technology hub.”

Creating new jobs – not just a lot of new jobs, but high-quality ones for Saudi citizens – is very important for the government, as is building skills in the country. But there are some challenges in getting people out to the remote places targeted by Neom. Most of the citizens live in and around traditional urban hubs in the capital and Riyadh or Jeddah, and strong extended family ties are an important aspect of the culture

Despite the challenges, Neom has generated significant global media attention. “There are a lot of world firsts on the Neom website,” said Mogielnicki. “It fits the high risk, high reward model that a lot of Saudi government economic policymaking and development projects are following at the moment.”

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