Saudi Arabia Recalibrates Mega Ambitions as Spending Reviews Hit Neom, Riyadh and World Cup Plans
Saudi Arabia is entering a new phase of economic pragmatism, as sweeping reviews across some of its most ambitious giga-projects signal a decisive shift from unchecked expansion to disciplined prioritization. From the futuristic city of Neom to proposed World Cup stadiums and landmark developments in Riyadh and Jeddah, the kingdom is reassessing what can realistically be delivered within tightening financial and logistical constraints.
After months of signaling a more cautious approach, authorities have begun making difficult choices. The recalibration gained momentum this week with delays to the 2029 Asian Winter Games a flagship event central to Saudi Arabia’s global sporting ambitions. The escalating costs and complexity of constructing ski facilities in a desert environment have increasingly challenged the project’s feasibility.
At the same time, officials are reviewing some of the kingdom’s most high-profile ventures, including The Line in Neom a planned pair of mirrored skyscrapers stretching 106 miles and The Mukaab, a massive cube-shaped structure envisioned to be large enough to contain 20 Empire State Buildings in central Riyadh.
These moves build on a broader reckoning that began in late 2023, when the government first hinted that timelines for certain mega-projects could be extended. Since then, several developments have been scaled back or delayed as Saudi Arabia adjusts to weaker oil prices, tighter global financing conditions and softer foreign direct investment inflows.
A key focus of the latest review is New Murabba, the proposed downtown district in Riyadh that was set to house The Mukaab. According to people familiar with the matter, plans now under consideration include scrapping a stadium initially earmarked for the 2034 FIFA World Cup. Developers have reportedly been instructed by the Public Investment Fund (PIF) to submit revised proposals outlining what can realistically be delivered in the near to medium term.
In Neom, uncertainty also surrounds the future scope of The Line. Originally envisioned to include a World Cup stadium suspended more than 350 meters above ground, the project is currently on hold as its design undergoes a comprehensive overhaul. Insiders suggest the final outcome will likely be a significantly smaller and more conventional development, with the World Cup stadium component dropped altogether.
The pullback is not limited to Neom and Riyadh. Several projects near Jeddah are also under review, including the proposed Qiddiya Coast, a planned entertainment island. Plans for a World Cup stadium there may no longer proceed, according to sources.
Meanwhile, Qiddiya City in Riyadh is moving ahead with the construction of the Prince Mohammed bin Salman Stadium, underscoring the government’s selective approach rather than a wholesale retreat.
While the PIF, Qiddiya, New Murabba and the Ministry of Sport declined to comment, a Neom spokesperson emphasized that the development remains aligned with long-term national goals. “We’re always looking at how to phase and prioritize our initiatives so they align with national objectives and create long-term value,” the spokesperson said, adding that Neom is advancing projects based on strategic priorities, market readiness and sustainable economic impact.
At the heart of the retrenchment is a recalibration by the roughly $1 trillion Public Investment Fund and the central government, as they concentrate resources on projects tied to immovable deadlines notably the World Expo 2030 and the FIFA World Cup 2034. Even then, earlier assumptions are being revisited, including whether Saudi Arabia truly needs to build at least eight new stadiums from scratch, with increasing emphasis now placed on refurbishing existing venues.
The strategy mirrors decisions made by previous World Cup hosts. Qatar scaled back stadium plans ahead of the 2022 tournament, while Russia adopted similar cost-cutting measures for the 2018 championship.
Saudi Arabia’s evolving mantra was summed up by Finance Minister Mohammed Al-Jadaan at the World Economic Forum in Davos, where he stressed the need for “optimal impact at the right cost” a clear signal of tighter scrutiny following years of aggressive spending.
The numbers reflect the shift. Spending on giga-project awards has fallen sharply, from a peak of about $35 billion in 2023 to roughly $13 billion in 2025, according to data from MEED. Economists say the reassessment was inevitable.
“Some of the projects that are now being delayed or scaled back were simply too ambitious,” said Azad Zangana, head of GCC macroeconomic analysis at Oxford Economics. “Authorities appear to be choosing to be more selective.”
While officials have not publicly detailed which projects will proceed, clearer priorities are emerging. Future investment is likely to favor initiatives capable of attracting private-sector participation and foreign capital, particularly in sectors such as artificial intelligence, tourism, finance and advanced infrastructure.
Read also Saudi Arabia Scales Back Ambitious Neom Megacity After Cost and Delay Concerns
To ease the financial burden, the PIF has intensified efforts to draw in Saudi business families and private investors, while the government continues to tap international bond markets, making the kingdom one of the most active sovereign issuers among emerging economies.
Reforms aimed at opening real estate and capital markets to foreign investors are also accelerating, helping fuel a 9% rally in the benchmark stock index this year, following a challenging 2025.
Projects deemed unlikely to deliver immediate economic returns or attract foreign investment under
Vision 2030 are expected to receive fewer resources going forward. The International Monetary Fund has welcomed the reprioritization, noting in December that it helps focus spending while reducing the risk of economic overheating.
Analysts at Goldman Sachs, Bank of America and T. Rowe Price echoed that view, describing the shift as a necessary and positive adjustment after years of planning shaped by higher oil prices, cheaper capital and looser global trade conditions.
Ultimately, Saudi Arabia’s pullback underscores a delicate balancing act: sustaining momentum behind Crown Prince Mohammed bin Salman’s ambitious transformation agenda, while adapting to economic realities, and ensuring that scale no longer comes at the expense of sustainability.
