Saudi Arabia's national transformation project "Vision 2030," spearheaded by Crown Prince Mohammed bin Salman, has entered a full review phase amid the fallout from the Middle East war. As key initiatives are being scaled back or halted one after another, the blueprint for a "Saudi Arabia without oil" is being shaken to its core.
The Wall Street Journal reported on Monday, citing Saudi officials, that most core projects under Vision 2030 have entered a review stage. War-related cumulative revenue losses and associated expenditures have already exceeded $10 billion, according to the report.
Iran's blockade of the Strait of Hormuz has caused Saudi oil exports to plunge to half their normal levels. Most offshore oil fields are currently shut down. Iran's launch of hundreds of drones and ballistic missiles at Saudi Arabia has also severely damaged the kingdom's image as a "safe investment destination." Major international events, including sports competitions and capital market forums, have been canceled in succession, and some office buildings have closed following Iranian retaliation threats.
Vision 2030, announced in 2016 under Crown Prince bin Salman's leadership, is a long-term national development strategy aimed at breaking away from an oil-dependent economic structure and achieving modernization across society and culture.
The impact on flagship projects has been particularly striking. The "Neom City" plan to build 488-meter-tall skyscrapers spanning 170 kilometers along the Red Sea coast has already been quietly scaled back. The Journal reported that only a vast empty lot stretching approximately 120 kilometers remains at the construction site.
The luxury marine resort island project "Sindalah" has also been effectively suspended indefinitely. Sindalah held a major opening event in October 2024 attended by celebrities including actor Will Smith, but shoddy construction reportedly makes a proper opening impossible without hundreds of millions of dollars in repairs. According to a former employee, the resort's restaurants even disposed of 23 kilograms of caviar worth tens of thousands of dollars.
Fiscal pressure is spreading across all fronts. Saudi Arabia's sovereign wealth fund, the Public Investment Fund, had reportedly been cutting spending and hiring while disposing of a significant portion of its U.S. stock holdings even before the war began. In December last year, PIF directly appealed to domestic companies and wealthy individuals for additional investment in national projects. Government ministries have also issued directives to civil servants to limit overseas business trips and use budget accommodations.
Analysis suggests risks will not disappear even after a ceasefire. As a Gulf neighbor, Saudi Arabia will find it difficult to escape the sphere of influence of Iran's hardline regime. In that case, foreign investor flight could intensify while billions of dollars in additional defense spending may become unavoidable, the Journal noted.