Saudi downscales Red Sea giga-project

RIYADH, Saudi Arabia (AFP) — Saudi Arabia is scaling back plans to build 81 luxury resorts on the Red Sea by 2030, seven sources told Agence France-Presse (AFP), as the kingdom rethinks the multi-billion-dollar mega-projects meant to reshape its oil-reliant economy.

Stubbornly low oil prices and patchy demand have forced a rethink of the flamboyant “giga-projects” — centerpieces of Crown Prince Mohammed bin Salman’s Vision 2030 program to diversify Saudi Arabia’s economy.

Red Sea Global (RSG) denied plans to downsize, saying the project would continue after the initial phase of 27 resorts is completed this year.

But sources with knowledge of the plans said construction would halt at the end of 2026, costing dozens of jobs at RSG and hundreds at contracting firms.

The sources spoke on condition of anonymity due to the sensitivity of the matter.

“A decision was taken to stop work on Phase Two of the Red Sea projects,” a senior RSG source told AFP.

“Current operating costs exceed revenues in a way that has become unsustainable,” another source at the company added.

Seven sources at RSG, other giga-projects and related companies and consultancies said the Red Sea construction would be put on pause.