RIYADH, October 26, 2017 – The Russian Direct Investment Fund (RDIF) said on Thursday that together with its international partners it will join a $500-billion project to build NEOM, a city of the future and a major industrial and business zone in northwest Saudi Arabia, under the Kingdom’s ambitious Vision 2030 plan.
“We would like for the first time to announce that RDIF and its top international partners will invest in and support NEOM city project in five key areas where we believe we have major technological expertise and our partners have major technological expertise,” Kirill Dmitriev, the chief executive officer of RDIF, told a press conference.
“We are talking about several billion dollars jointly,” added Dmitriev, speaking to reporters at the sidelines of the October 24-26 Future Investment Initiative (FII) conference in Riyadh, when asked about the extent of the investment by RDIF and its partners.
The involvement of RDIF and its partners in the NEOM project will facilitate participation of leading Russian innovative companies in these five key areas: solar energy, healthcare and education, artificial intelligence, high-speed transportation as well as port infrastructure for the transshipment of agricultural products, he said.
The NEOM project plan was announced by Crown Prince Mohammed bin Salman – the architect of Vision 2030 to diversify the Saudi economy and attract foreign investment – on Tuesday during FII, a major conference hosted by the Public Investment Fund (PIF) to highlight the lucrative business opportunities on offer in the country.
Over the coming years, NEOM is expected to attract more than $500 billion, from both local and international investors, including the Kingdom and PIF, the main sovereign wealth fund.
The project to be built on a 26,500 km2 piece of land in Saudi Arabia’s northwest corner will be transformed into a revolutionary project of sustainable cities, villages and communities run by solar and wind power and state-of-the-art manufacturing facilities. NEOM – set to include territory from within the Egyptian and Jordanian borders – will provide several unique development opportunities. It will focus on different sectors and industries, including energy, manufacturing, water, biotech, food, and entertainment.
“We are pleased to participate in such an ambitious project that will combine new technologies from a wide range of areas – from renewable energy, advanced transportation and port infrastructure to artificial intelligence,” Dmitriev said in a statement.
“RDIF plans to co-invest alongside international funds and bring leading Russian companies into the NEOM project, thus fostering expansion of their innovative technologies in the promising markets of Saudi Arabia and Middle East as a whole,” the RDIF CEO added.
He said NEOM can be a major port hub in the Middle East for agricultural products.
The deepening of Saudi Arabia’s economic ties with Russia was one of the main outcomes of a historic state visit by King Salman bin Abdulaziz to Moscow last month.
Dmitriev said that out of a total of $10 billion earmarked for investment by the recently-created Russia-Saudi Investment Fund, more than $1 billion has already been committed to various projects, mostly in Russia. The fund was established by RDIF and PIF, Saudi Arabia’s main sovereign wealth fund, to invest in attractive projects primarily within Russia that help to strengthen trade, economic and investment cooperation between the Russian Federation and Saudi Arabia. Priority investment sectors include innovation and hi-tech, infrastructure, food production and agriculture, consumer goods and services, healthcare and pharmaceuticals.