Saudi Arabia, Egypt set up $10bn fund for mega city

Saudi Arabia and Egypt have jointly set up a $10 billion fund to develop a planned a $500-billion mega-city and a business zone, with the latter committing over 1,000 sq km of land in the south Sinai region, said a report.

The announcement comes at the start of Saudi Crown Prince Mohammed bin Salman's first public overseas visit after becoming heir apparent last year and purging the kingdom's business and political elite in a crackdown on corruption that saw top princes and businessmen detained, reported Reuters citing a senior Saudi official.

He was given a grand welcome on hs maiden visit to Cairo by Egypt‘s President Abdel Fattah Al Sisi at the airport.

Prince Mohammed had previously announced plans for the 26,500-sq-km zone, known as Neom, at an international investment conference in Riyadh.

The project is aimed at turning the kingdom into a leading global hub that exemplifies the future of human civilisation by offering its inhabitants an idyllic lifestyle combined with exceptional economic prospects.

Set to be the world’s first independent special zone stretching over three countries - extending across the Egyptian and Jordanian borders - Neom will become a new vibrant destination located in the northwestern region of Saudi Arabia, said the report.

Riyadh’s part of the new joint investment fund will be cash to help develop the Egyptian side of the Neom.

The mega-city, with its own judicial system and legislation designed to attract international investors, is to focus on industries such as energy and water, biotechnology, food, advanced manufacturing and tourism, it added.

The project is part of bold moves by Prince Mohammed to wean the world’s top crude exporter off oil revenues that include plans to float a portion of state oil giant Saudi Aramco.

Saudi Arabia plans to build seven cities and tourism projects, while Egypt will focus on developing the existing resort cities of Sharm El Sheikh and Hurghada, said the report citing the official.

It will also set up 50 resorts and four small cities as part of a separate tourism initiative announced last August and backed by the country’s Public Investment Fund (PIF), he added.

Work is set to start on the kingdom's ambitious project in 2019 and its first phase is likely to completed by late 2022.