NEOM: A new channel for Egyptian-Saudi cooperation

CAIRO – 16 August 2018: Within the “strategic and discrete” nature of the Egyptian-Saudi relations” as described by President Sisi, King Salman bin Abdulaziz accompanied by Crown Prince Mohammed bin Salman, invited President Sisi for a meeting on Aug. 14, 2018 in the futuristic city of NEOM, the new cooperative aspect of the Egyptian-Saudi cooperation.

NEOM is the first private zone to span Egypt, Saudi Arabia and Jordan and to be funded by the Saudi Arabian Public Investment Fund, as well as local and international investors, Mohamed bin Salman stated.

The visit is considered to be unprecedented and exceptional, as President Sisi is the first high-ranked official to be welcomed by Kind Salman in NEOM.

During the meeting, the leaders exchanged views on the latest developments in the region, its national security, issues of mutual development interests, and bilateral relations.

Additionally, the Saudi allies organized a large banquet, with many princes and ministers attending the meeting in addition to the Head of the Egyptian General Intelligence, Abbas Kamel.

The meeting endorsed the harmonious and strategic frameworks that make up Egyptian-Saudi relations. In a sign of warmer relations and closer cooperation, both Egypt and Saudi Arabia embarked on mutual and collaborative initiatives to boost stability and development in the region.

Recently, the Saudi-Egyptian accord has brought many indications that underline the depth of the relationship between the two countries, and their partnership in renaissance, development and security through various mega projects.

From the beginning, there was a recognition that cooperation between the two countries is indispensable for stability in the region, and therefore the two countries needed to find a way to expand their cooperation beyond the existing status quo. Accordingly, both states allowed many new channels for cooperation to tighten their relations and enhance the region’s security.

NEOM is a $500 billion business and industrial zone in which both Egypt and Jordan are to be partners with Saudi Arabia. The NEOM city project was launched by Crown Prince Mohamed bin Salman in October 2017, involving the creation of a huge transnational city and economic zone that covers 26,500 square kilometers in Saudi Arabia. Within that initiative, Egypt would allocate more than 1,000 square kilometers of land to the project in the South Sinai governorate.
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The significance of the meeting in NEOM

According to Professor Gamal Soltan, an academic advisor at Al-Ahram Center for Political and Strategic Studies ACPSS and former professor of International Relations and Middle Eastern Politics at The American University in Cairo, being held in NEOM, the meeting had both strategic and political significance.

Strategically, welcoming Sisi as the first high-ranked official in NEOM signifies the full partnership between Saudi Arabia and Egypt, without which the project would not have been realized despite the leading role played by the Kingdom.

Politically, the visit indicates the good shape of the bilateral relations between both states. Additionally, organizing the meeting one day after the visit of the Yemeni President Abdrabbuh Mansour Hadi to Egypt highlights the fact that Egypt and Saudi Arabia are in continuous consultation and dialogue regarding the Yemeni issue, negating all rumors about any disaccord between them and about Egyptian military contribution in the war in Yemen, stated Sultan.

Furthermore, Sultan stressed the fact that the leaders of both regimes are fully aware of the necessity of working together, and avoiding enmity despite any differences. This awareness is built upon previous history of disagreement between them back in the 1960s during the conflict in Yemen which resulted in deterioration for both of them. Hence, both regimes are willing to manage their differences to maintain agreement.

Moreover, Sultan highlighted the major and crucial role played by Saudi Arabia backing Egypt when it fell in the hands of the Muslim Brothers. The Kingdom feared the collapse of Egypt “the older sister” which in turn would have led to the collapse of the whole Arab region. In 2013, Saudi Arabia supported Egypt politically and financially to curb the MB’s oppressive regime and boost Sisi`s initiative to save the country, the professor said.

Furthermore, the new city reflects the common interest of Egypt and Saudi Arabia to fight terrorism. On the one hand, Crown Prince Mohammed bin Salman, the driving force behind sweeping social, religious, and economic changes in Saudi Arabia, took the initiative to counter “radical ideologies" through spreading a more tolerant and moderate version of Islam. The mega-city, with its own judicial system and legislation is designed to attract international investors, in an attempt to put his initiative into practice.

He also delivered a warning to ultraconservatives, vowing to destroy "extremist ideologies" and return to "a more moderate Islam.” "We want to lead normal lives, where our religion and our traditions translate into tolerance, so that we coexist with the world and take part in developing the world,” he stated.

On the other hand, Egypt continues its fight against terrorism since 2013 through the state initiative to develop Sinai. General Khalid Fouda, the governor of South Sinai, said that the free zone to be built in Nuweiba serving the NEOM project will be built on one million square meters in Nuweiba that will no longer be neglected. Ayman Hosny, a member of Ras Sedr Investors Association, said that the new project announced by the Kingdom of Saudi Arabia is a cultural extension of the urban and touristic development in South Sinai, specifically in Ras Sedr region, which is the first region to benefit from the geographical importance of NEOM, ending the old myth of “the neglected Sinai” and closing all possible channels for terrorist activities there.

Economically, the Egyptian Ministry of Investment and International Cooperation announced that it will also finance the development of the Egyptian side of NEOM mega-city and a free economic zone.

The new agreements come within the Egyptian government's plans to stimulate foreign direct investment, focusing on developing the poor governorates by enhancing economic activities and providing job opportunities for Egyptians there.

The Kingdom’s unrivaled leader, Prince Mohammed, is spearheading efforts to prepare Saudi Arabia for the post-oil era, in which he intends to end Saudi Arabia’s long dependency on the oil sector by diversifying the Kingdom’s economic sector. The Saudi Prince stated that NEOM as an economic zone will have many ports, “some of them in Saudi Arabia and some of them in Egypt.”

NEOM overlooks the Red Sea, one of the world’s most prominent economic arteries, through which nearly one tenth of the world’s trade flows; facilitating NEOM's rapid emergence as a global hub that has potential to bring together trade from Asia, Africa, Europe and America.

The megacity is to transform the economy and society by introducing a raft of liberalizing reforms as planned by President Sisi and King Salman. The city aims to embrace digital technologies and services to make it a major commercial location in the Middle East. Consequently, such development will be a major driver of tourism.

According to Al Arabiya the name of the project has significant connotation. The first three characters "NEO" comes from the Latin word which means “new” and the fourth character "M" is the abbreviation of the Arabic word “Mostaqbal” which means “future.”

NEOM enjoys an uninterrupted coastline stretching over 468 kilometers that will be powered solely by sources of renewable energy.

The zone focuses on nine specialized investment sectors including energy, water, mobility, food, technological and digital science, advanced manufacturing, media, and entertainment.

According to the Egyptian and Saudi governments, these sectors stimulate economic growth and diversification by nurturing international innovation and manufacturing. As a result, it will drive local industries, and enhance GDP growth in the Kingdom, according to the official Saudi Press Agency.