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Gulf’s megaprojects face delays, reassessment

Saudi Arabia has cut capital expenditure for a number of Vision 2030 projects amid a drop in oil prices and Chinese investment. Will other Gulf states follow suit?
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Weakened by the recent steep oil price decline, Saudi Arabia declared it must “extremely reduce” budget expenditures and thus slashed operational and capital spending by $26.6 billion, according to a May 11 statement by Finance Minister Mohammed al-Jadaan. 

Crown Prince Mohammed bin Salman’s programs and reforms to pivot the economy away from hydrocarbon revenues will suffer significant cuts. NEOM, a proposed $500 billion futuristic city on the Red Sea coast, might see project implementation “stretched out over a longer period,” said Ali Shihabi, a member of the NEOM advisory board. 

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