Now, that ambition is in tatters. Can Saudi Arabia pick up the pieces and truly diversify its economy away from oil, or are its plans dead in the water, leaving the Kingdom's survival forever tied to oil revenues?Earlier this week, Saudi Arabia's Aramco said it would shelve an investment of several billion dollars in Sempra Energy's Port Arthur LNG terminal. It also said it would delay investments in a $20-billion refining and petrochemical project at home, at its Yanbu hub. The reason: cash conservation.
Earlier this year, Riyadh government sources told the Wall Street Journal that Saudi Arabia was not pursuing its $200-billion solar farm project it had conceived in partnership with Japan's SoftBank. Nobody was working on the project, the sources said, and Riyadh was discussing a replacement with several smaller solar projects.
The $500-billion smart city project, Neom, is still on the table, it appears. The Kingdom's oil ministry recently said it would help fund the project and make sure it was completed on time.
Neom is the flagship project of Vision 2030, Prince Mohammed's brainchild aimed at reducing Saudi Arabia's reliance on oil revenues. Ironically, this diversification drive relied on precisely these oil revenues to materialize. And now that these revenues have been significantly reduced because of the effects the coronavirus pandemic had on oil demand, Prince Mohammed's vision is under threat.