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Banking

The gradual rise of King Abdullah Economic City

A small dredger dips lethargically into the shimmering Red Sea. The future presence of a world-class container port here – bringing seagoing vessels deep into the flat, windy desert nearby – looks improbable. Indeed, four years into the construction of what is supposed to be a purpose-built metropolis, King Abdullah Economic City looks as hubristic as ever. This $27 billion project, sponsored by an affiliate of Dubai developer Emaar, has always had its doubters. That was before the collapse of the off-plan sales model in property development in the Middle East.

By the time it is completed in 2025, about 2 million people are supposed to inhabit the new city, about an hour’s drive north of Jeddah. The aim is for the city to be the size of Washington DC.

A handful of office and apartment blocks have already been built, but only in a tiny corner – perhaps 1% of the city. According to a source involved in the project, fewer than 50 families have moved in, including some employees of the city itself.

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