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Business

Saudi tries to tame its costly white elephant

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Business

Saudi tries to tame its costly white elephant

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00:00:00
>> Riyadh's new financial center, a collection of glass and steel towers out here on the edge of the Saudi capital. It's how the government envisions the future of investment into Saudi Arabia. I'm Angus McDowall reporting for Reuters News, here in Riyadh. The King Abdullah Financial District has for many years been seen as a problem project.
00:00:24
It has run over time, it's been more expensive than expected and the government has, at various times, placed strains on the way it's been carried out. Now under a new reform plan, the Deputy Crown Prince, Mohammed Bin Salman says that they must change that. The King Abdullah Financial District will now include some kind of special visa exemption zone to make it easier for foreign business travelers to come here and it will also include more residential space.
00:00:55
The idea seems to be modeled on areas in the United Arab Emirates, next door to Saudi Arabia, which have long proved far more successful in attracting foreign business and that seems to be the way that Saudi Arabia is going. Oil prices have crashed since mid-2014, placing huge strain on Saudi Arabia's budget and its economy.
00:01:18
What the King Abdullah Financial District is supposed to do is to help invigorate the private sector to relieve pressure on the government. But in the future, it's very unclear whether huge, expensive projects like this will still be affordable.