RED SEA PROJECT
Saudi Arabia to pump petrodollars into tourism
The Red Sea Project will be a standalone company lead by a former director of London’s Canary Wharf business zone
Riyadh — Saudi Arabia’s Red Sea Project, a vast tourist development aimed at opening the economy, has been registered as a standalone company and will be headed by a former director of London’s Canary Wharf business zone, the country’s sovereign wealth fund said on Sunday.
The Saudi government revealed plans to develop resorts on about 50 islands off the kingdom’s Red Sea coast and said the Public Investment Fund (PIF), the country’s sovereign wealth fund, would make initial investments and seek partnerships with international investors and hoteliers in July.
The Red Sea Project, part of an ambitious strategy to open the economy and ease social restrictions, will be built between the cities of Amlaj and al-Wajh.
It will offer a nature reserve, heritage sites and diving in coral reefs. It will break ground in the third quarter of 2019 and complete its first phase in late 2022.
PIF has two other major initiatives: NEOM — a $500bn business and industrial zone extending into Egypt and Jordan — and Qiddiya, a multibillion dollar entertainment resort that will be twice as big as Disney World.
"The ministry of commerce and investment has registered The Red Sea Development Company as a closed joint-stock company wholly owned by PIF," an e-mail to Reuters said.
John Pagano, the former MD for development of London’s Canary Wharf Group, had been appointed as CEO, it said.
The Red Sea Development would create a special economic zone with its own regulatory framework, visas on entry, relaxed social norms and improved business regulations, the statement said.
This would enable it to develop and deliver a world-class international tourist destination.
The fund, chaired by Crown Prince Mohammed bin Salman, is believed to have assets totalling about $183bn and is set to receive a cash injection in 2019 after the share sale of state oil giant Saudi Aramco.
The crown prince has said that more than half of the proceeds from that sale would be reinvested domestically to develop promising Saudi nonoil sectors.