Geopolitics and luxury: Saudi Arabia’s Vision 2030 project under high tension

Saudi Prince Mohammed Ben Salmane (MBS), the dominant figure in Riyadh, is banking on Vision 2030 to ensure Saudi Arabia's transition to a new economic development model. To be successful, this ambitious project requires regional stability to avoid major delays in its implementation and to allay the concerns of investors and international partners. In this context, the current crisis in Syria is a worrying obstacle.

Since 8 December, the dictator Bashar Al-Assad has found refuge in Russia, while the Islamist forces of HTS have conquered a large part of Syrian territory in a very short space of time, starting with the martyred city of Aleppo. For the moment, under the watchful eye of the international community, HTS is presenting a moderate image, and its leaders claim to have abandoned the methods of terror once associated with the Daesh and al-Qaeda caliphates. But what will happen tomorrow when their power is firmly established? Could we be faced with a new mass exodus of refugees, an unprecedented humanitarian crisis, a Syrian civil war compounding the chaos already caused by the conflict between Israel and Hamas involving Tehran and Lebanon?

Launched with great fanfare in 2016 by the Saudi prince, in collaboration with leading American consultancies such as McKinsey, Vision 2030 aims to transform the kingdom's economic model. The aim is to make Saudi Arabia less dependent on oil revenues, which until recently accounted for 90% of government revenue while adopting a more liberal and diversified approach to development.

With oil reserves dwindling, Mohammed Ben Salman needs to think about diversification and the future, while generating revenues more or less equivalent to those from oil (around $250 billion a year). The private sector is essential to this plan, and its share of GDP is expected to grow from 40% to 65%. One of the objectives of Vision 2030 is to transform Saudi Arabia into a major high-end tourist destination. For example, over 19 billion dollars have been invested in developing the Al Ula archaeological site and equipping it with luxury infrastructures.

In terms of strategic alliances, Emmanuel Macron, President of the French Republic, recently visited Mohammed Ben Salman to strengthen his relationship with the kingdom and undertake various commercial and strategic projects. However, the United States remains MBS's main partner. Although Saudi Arabia does not have an official procedure for joining the BRICS, it is pursuing a multi-alignment strategy. Its relations with China are solid, and it has a clear desire to de-escalate relations with Iran, a key issue for MBS's future.

While the chaos in the Middle East could jeopardise the success of Vision 2030 by causing foreign investors to flee the country, Saudi Arabia's role as a credible intermediary between Tehran and Washington could considerably boost Mohammed Ben Salman's international prestige.

Before the 7 October massacre in Israel, Tel Aviv and Riyadh were close to signing the Abraham Accords, paving the way for a normalisation of their relations. However, the war in Gaza has rekindled tensions, but the election of Donald Trump, who is close to MBS and favourable to Israel, could reshape relations in a positive direction. Meanwhile, projects linked to Vision 2030, especially the imposing real estate projects, are behind schedule.

‘The Line’, the futuristic city project that should have housed a million people by 2030, at a total cost of $500 billion (€475 billion), is racking up delays and budget overruns. According to Bloomberg, the project has been scaled back: by 2030, only 300,000 people will be able to settle in the new city, which will be just 2.5 km square, rather than the 16 announced. The same goes for New Murabba, the mega-skyscraper project in the shape of a cube big enough to accommodate 20 Empire State Buildings: this project, too, will suffer cuts and delays. Saudi Arabia will have to concentrate its revenues on hosting the next major events on its agenda, such as the World Expo in 2030 and the FIFA World Cup in 2034.

The price of a barrel of oil is currently too low to guarantee the necessary revenue for the plan, and destabilisation in the region could worsen the situation. The kingdom's ambition is to attract $100 billion in foreign direct investment each year by 2030, but by 2023, it had only achieved a quarter of this.