Saudi Arabia Is Quietly Reining In Its Vision 2030 Ambitions
In December 2024, Saudi Arabia secured another milestone in its quest to transform its global image and reshape its economy: winning the bid to host the 2034 FIFA World Cup.
For the country’s de facto ruler, Crown Prince Mohammad bin Salman, hosting the event will do far more than satisfy his known enthusiasm for sports. It also aligns seamlessly with his ambitious Vision 2030 program, launched in 2016 to turn Saudi Arabia into a hub for mega-projects and part of the kingdom’s broader plan of diversifying its traditionally oil-dependent economy.
The World Cup tournament offers another global platform to showcase the “new” Saudi Arabia, where sports, culture and entertainment are on the rise, increasingly reshaping the kingdom’s traditional ultra-conservative image.
However, despite some successes, the initial ambitions for Vision 2030 are beginning to show signs of strain. MBS, as he is popularly known, is now trying to balance the project’s grandiose schemes with mounting financial challenges, including uncertainty over its affordability. But this could very well end up putting pressure on Saudi citizens themselves, with implications for political stability.
If Vision 2030 has yielded mixed results so far, recent moves by the government reflect a growing sign of pragmatism. A prime example is NEOM, the ambitious $500 billion futuristic and green megacity, which serves as a flagship for Vision 2030 but also represents its challenges.
Last year, slightly past the halfway point of Vision 2030, the government seemed to finally acknowledge the need to temper expectations over NEOM. In November, Minister of Finance Mohammed Al-Jadaan announced that it would take 50 years or more to fully build the megacity, dampening earlier hopes that it would be completed by 2030.
This reality check followed news that NEOM’s projected population capacity would be slashed from 1.5 million to just 300,000 residents. And The Line—the planned 105-mile linear city of renewable energy-powered skyscrapers in the desert that is one of the more audacious pillars of the NEOM project—was scaled back to a more modest 1.5 miles by 2030. That reduction of The Line was a tacit admission of the infeasibility of the broader project, underscoring the need for better allocation of increasingly limited funds.
Even the successful bid to host the 2034 World Cup, while a significant win for Saudi Arabia’s global image, brings added pressures. The kingdom plans to host the tournament in 15 stadiums across the country. However, 11 of them, including one planned in NEOM, have not yet been built, while the four existing ones will undergo mass renovations. All told, it is another illustration of MBS’ bold agenda, but one that raises further questions about affordability.
Meanwhile, growing skepticism from international direct investors about the feasibility of Vision 2030’s mega-projects means that much of the financial burden will fall on Saudi Arabia itself, including its citizens. To bridge funding gaps and sustain its ambitious economic transformation, Riyadh has adopted unorthodox fiscal policies and turned to global financial markets. In early January, it issued its largest-ever bond sale of $12 billion, signaling a reliance on borrowing to support MBS’ projects while also managing fiscal pressures and balancing its books.
Among other things, these moves reveal the degree to which external factors, including geopolitical shifts, will have a notable impact Vision 2030’s trajectory. For instance, Russia’s war in Ukraine and the subsequent surge in oil prices to a peak of $139 per barrel in March 2022 briefly bolstered Saudi Arabia’s revenues, aiding recovery from the COVID-19 crisis when oil prices had dipped into negative territory.
While there is societal enthusiasm for Saudi Arabia’s transformation, rising cost of living might eventually stoke grievances, especially if ordinary Saudis do not reap benefits from Vision 2030’s projects.
However, the disruption to Red Sea shipping by the Houthis in Yemen since December 2023, along with concerns over a potential regional escalation of conflict pitting Israel, the U.S. and its allies against Iran, prompted MBS to adopt a cautious “no problems with neighbors” foreign policy, seeking to avoid geopolitical missteps that might threaten the kingdom’s security landscape and scare off investors.
The return of U.S. President Donald Trump to the White House has mixed implications for Vision 2030. On one hand, business ties between the Trump and Saudi royal families expanded even during the four years he was out of office, and they will probably continue to do so over the next four years. The Public Investment Fund—the main organ funding Vision 2030—invested $2 billion in a private equity firm run by Trump’s son-in-law, Jared Kushner, while the Trump Organization, run by Trump’s two sons Eric and Donald Jr., plans to build Trump Tower hotels in both Jeddah and Riyadh.
However, if Trump ramps up the U.S. trade war with China, that could have adverse implications for Riyadh, especially should pressure from Washington hinder Saudi Arabia’s access to Chinese semiconductors and green energy cooperation needed to power its futuristic projects, including NEOM. Moreover, MBS still seeks to develop a domestic nuclear program to diversify the kingdom’s energy sources and potentially even build a nuclear arsenal. But if Trump—like former President Joe Biden—makes civil nuclear assistance conditional on normalization of ties with Israel, which was derailed following Hamas’ attack on Oct. 7 and Israel’s subsequent war on Gaza, that could pose domestic political risks for Saudi Arabia.
In spite of all these wider challenges, oil prices will remain a critical factor shaping Saudi Arabia’s economic transformation and future. The International Monetary Fund estimates that the kingdom requires oil prices in the $90-100 per barrel range to fund Vision 2030 projects without incurring a budget deficit, significantly higher than the range of $65-85 per barrel that has persisted since early 2024.
And for all the talk of climate sustainability and net-zero emissions goals, even Saudi officials—including the head of the state oil company Aramco—acknowledge that Riyadh will remain dependent on fossil fuels for the foreseeable. While the non-oil sector has grown, signaling progress in diversification, hydrocarbons still account for about half of the kingdom’s GDP and 75 percent of government revenues.
While these dynamics create further uncertainty for Vision 2030, there have been mixed results on a microeconomic level. Unemployment has dropped to around 3 percent—around 7 percent for Saudi citizens—though this remains higher than in other Gulf countries like Qatar, where unemployment is below 1 percent.
More women are also entering the workforce, with their participation already exceeding Vision 2030 targets. That will further help consolidate the image of a changed Saudi Arabia on a societal level, which could help attract more tourism and investment. The country has also reached over 1.3 million small and medium enterprises, or SMEs, creating new job opportunities outside of the traditionally dominant public sector.
However, alongside these achievements and opportunities, questions persist about the livelihoods of ordinary Saudi citizens. While home ownership has risen and is nearing the government’s 70 percent target, many Saudis, particularly in Riyadh, still struggle to afford housing. House prices have surged by 86 percent since 2020—much higher than in many Western countries—driven by limited housing development and higher demand as citizens move to the capital for new job opportunities, which ultimately complicate government efforts to meet its own homeownership target.
While there is societal enthusiasm for Saudi Arabia’s transformation, rising cost of living, housing pressures and macro-financial pressure might eventually stoke grievances. This may become more pronounced when the dust settles from Vision 2030’s mega-projects—particularly given the construction delays—and after the 2034 World Cup concludes, especially if ordinary Saudis do not reap benefits from these projects. Substantial government spending perceived as disconnected from the everyday needs of the population could indeed heighten this risk.
MBS has attempted to reshape Saudi Arabia’s societal contract, but in so doing, he has also strengthened the state’s ability to counter potential discontent. However, dissatisfaction may still surface, even in a secure absolute monarchy like Saudi Arabia. In 2013, for instance, the “salary doesn’t meet my needs” campaign on Twitter, now X, garnered millions of tweets. And in 2017, austerity measures faced public criticism, particularly when juxtaposed with the royal family’s lavish spending at that time. Such frustrations could emerge again if the country faces more financial burdens and there is little to show for the projects of Vision 2030.
While Saudi Arabia has made strides in revamping its economy and society since the plan was announced almost nine years ago, the risks of overreach, from financial strain to public dissatisfaction, loom large. The government has shown increased awareness of the need to balance its grand ambitions with the realities of economic sustainability and geopolitical uncertainty. Although MBS may be reluctant to publicly admit defeat on his mega-projects after having announced them with so much fanfare, shifting his focus to more attainable goals might prove a wiser strategy.
Jonathan Fenton-Harvey is a British analyst and journalist whose work has focused largely on Gulf Cooperation Council affairs, as well as geopolitical and economic issues pertaining to the wider Middle East and Indo-Pacific. He has worked with or written for a wide range of think tanks and publications based in the U.S., the U.K. and the Middle East.