Korean companies may not be able to enjoy the benefits they have anticipated from Saudi Arabia’s NEOM project, as the Middle Eastern country appears to be scaling down the urban development project amid its prolonged financial difficulties, according to industry officials, today.

Major construction firms in Korea initially sought to win large-scale orders for the project to overcome a recent slump in the domestic housing market.

When Saudi Crown Prince Mohammed bin Salman Al Saud visited Seoul in 2022, heads of Korea’s leading conglomerates met him in person seeking lucrative business opportunities. In 2023, President Yoon Suk Yeol visited Riyadh with business leaders to promote Korea’s capabilities in smart city construction.

“The NEOM project is very challenging, and its size may exceed the initial estimation of $500 billion due to internal and external factors,”  “The Red Sea shipping crisis has delayed shipping and increased delivery costs, having a negative impact on Saudi Arabia’s giga-projects.” - International Contractors Association of Korea researcher Park Hyung-jin

NEOM CEO Nadhmi Al Nasr, however, said in the latest newsletter that significant advances have been made in the development of NEOM’s regions.

Read the full story at Korea Times