If you build it, will they come?

The massive increase of oil revenues in most of the United Arab Emirates countries have not only allowed for investment in Asia and the U.S., but also an economic development boom at home, with the aim of attracting foreign investment to the region.

Perhaps to ensure that the memory of his dynasty lives forever, the king of Saudi Arabia has lent his name to the largest private sector investment in Saudi Arabia. King Abdullah Economic City (that is the full name), which began construction in 2005, will cost $26.6 billion and promises to create from 500,000 to 1 million jobs. The Saudi Arabia General Investment Authority plans to build other smaller cities throughout the kingdom.

This week, the city's main developer, Emaar, has signed a series of contracts for energy services: Siemens (based in Germany) will set up a power generation grid and the Arabian BEMCO Contracting Company (based in Jeddah) will install an open-cycle gas turbine power plant. On Saturday, Emaar unveiled its first residential community, Bay La Sun Village, which will be completed by 2008.

The city, when completed, will be located on 55 million square meters of land with 21 miles of shoreline north of the city of Jeddah on the Red Sea. Aside from the industrial district, the futuristic city will have a seaport, "financial island," "education zone," resorts, and a residential area.

In the tradition of building a world-class city from no city at all (see previous BF entry on the new Dubai), there is a lot of hype and marketing surrounding the development. So far, however, there is only expressed interest from local and international investors.

Sources: Korea Times, King Abdullah Economic City, Arabian Business, Khaleej Times