Largest construction customer
‘5% of global logistics market’
Market driver for decades
The Neom giga-project in Saudi Arabia is currently using one fifth of all the steel produced in the world, an official said on Monday.
The futuristic city will be the world’s largest customer for construction materials for several decades, said Manar Al Moneef, Neom’s chief investment officer.
She told the Global Logistics Forum in the King Abdullah Financial District in Riyadh that the $500 billion project would be one of the world’s leading drivers of the global logistics sector in coming years.
“Neom is going to be the largest customer over the next decade. If you look at our demand in logistics it’s 5 percent of the global logistics market,” she told the forum, in rare public comments.
- Neom offers financial guarantees to lure private investors
- Neom sets up $186m concrete hub for The Line
- Three miles of the 100-mile Line city to be built by 2030
Neom’s demand for steel meant “we are 20 percent of the global steel market. If you look at our demand in elevators, cement and so on … put simply, Neom is going to be the largest customer over the next few decades,” Al Moneef said.
Neom, located in the far northwest of Saudi Arabia, is the jewel in the crown of Saudi Arabia’s economic development projects, which have been valued at more than $1.25 trillion.
However, some projects have slowed down as Saudi Arabia’s Public Investment Fund (PIF) faces funding pressures caused by lower oil prices and pressure to funnel cash towards projects in Riyadh before the World Expo 2030 and the 2034 World Cup, both taking place in the Saudi capital.
The Neom projects include a horizontal city called The Line which is due for final completion at 170km long in 2045. A small central section just 5km long has a target date of 2030.
Neom also includes the Trojena winter resort, 12 luxury resorts called Magna, the Sindalah island resort, and an industrial city called Oxagon.
Dhiraj Joshi, a partner at the management consultancy Arthur D Little Middle East, said: “Projects like Neom, Oxagon, getting all the hotels ready in various parts, is a long-term investment strategy so there is no hurry [in] the next four or five years when we get done with Expo and World Cup.”
Neom would be prioritised again later, Joshi said.
source/content: agbi.com / Arabian Gulf Business Insight (headline edited)
___________
Neom could be the world’s largest customer for construction materials for several decades, according to an official / pic: Getty Images / UnSplash
_________________
SAUDI ARABIA