Who wouldn't want to live in the lovely "Plastics Zone?"
America's eye is on Saudi Arabia today as President Obama kicks off his trip to the Middle East. The Arab nation's economy has taken a bit of a dip since oil revenues have fallen, so Saudi King Abdullah is trying to branch out a bit. They're building four new 'Economic Cities' in an attempt to diversify the Saudi economy.
Each city is pre-planned to foster high-energy industries like plastics, aluminum, and steel. The largest of these custom-built metropolises, the King Abdullah Economic City, already has $27 billion in private sector investments. It's set to feature such delightful-sounding neighborhoods as "Plastics Valley" and "The Education Zone."
The Saudi government had originally planned to built six cities, but due to the economic downturn, two of them have been canceled. Much of the private investment in the cities comes from family-owned business empires that took out astounding loans during the oil boom to foster their own growth nd are now suspected of having huge losses due to the oil bust.
One of the most prominent Saudi billionaires, Maan Al-Sanea, a stakeholder at HSBC, entered restructuring yesterday after defaulting in his loans. If this trend continues and family investment dries up, Saudi Arabia could be left with half-built cities.
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