Saudi mega cities take off

They represent the launch of new industries and businesses comprising the most ambitious long-term investments the kingdom has ever undertaken.

As well as stimulating a huge expansion of the kingdom's growing non-oil economy they will ease the growing pressures on Riyadh, Jeddah and Dammam, where most urban expansion has taken place since the first oil boom in the 1970s.

Another mega new city development able to support one million people is also planned at Sudair north of Riyadh.

A 'concept master plan' for the projected 20-year development is being carried out by Singapore Jurong International for Saudi Industrial Property Authority (SIPA). Bids for the first stage of development will be invited by late June according to SIPA director-general Tawfiq al-Rabiah.

An essential feature of the new economic cities is that their developments are in the main private sector led albeit with the close encouragement of Saudi Arabian General Investment Authority (SAGIA) as a facilitator.

King Abdullah Economic City (KAEC) is being built to accommodate to two million residents and support a million jobs when completed on a 168 square kilometre site at Rabigh north of Jeddah.

The city will cost an eventual $80bn, the largest private sector development in the region. It is being developed by Dubai developer Emaar in association with SAGIA through 'Emaar: The Economic City' a company listed on Riyadh's stock market.

The company has signed an agreement allowing marine terminal operator DP World to build-own and operate the city's planned multi-purpose cargo port.

Work has begun on the first phase of the residential component known as Bay La Sun Village. Freyssinet Saudi Arabia has been awarded a $104m contract for construction of various facilities including office buildings, restaurants and shops. KAEC's developer has recently launched the sale of apartments in the planned residential community with prices starting at $120,000.

Emaar and SAGIA recently signed a memorandum with Global Educational Management Systems to establish schools accommodating 2,000 students and designed to provide 'international standards of education'.

Training is also a key component in development of Madina's 'Knowledge Economic City (KEC)'.

Specialised communication and IT institutions colleges, lecture halls, laboratories, workshops and other facilities for up to 24,000 students are to be developed.

A 'strategic partnership' has been reached with with Microsoft Saudi Arabia to establish its own school to train Saudis in the city. Cisco, which is providing the new city's network infrastructure, will also set up an academy in the city to train IT professionals to design and maintain networks.

The Barcelona-based Competitiveness Institute is advising on fostering clusters of developments and improving local competitiveness. KEC intends to encourage medical and bioscience enterprises as well as IT businesses to be developed in the course of the project.

KEC chief executive Tahir Bawazir believes that the new city's facilities and environment will attract foreign direct investment, create jobs and encourage Muslim scientists, in particular, to relocate to Saudi Arabia and help the city become a leader in the IT arena.