Neom is reportedly turning into a financial disaster, except for McKinsey & Co.

A recent report from The Wall Street Journal reveals that Saudi Arabia’s ambitious Neom project, spearheaded by Crown Prince Mohammed bin Salman, is facing significant financial challenges. The project, which aims to create a futuristic, carbon-neutral city stretching 105 miles, has already cost the country $50 billion and could require an additional 55 years of construction with an estimated cost of $8.8 trillion, as per an internal audit disclosed to Neom’s board.

The scale of the project’s cost overruns and delays is raising concerns, drawing parallels to Saudi Arabia’s own Waterloo moment. Crown Prince Mohammed bin Salman may have underestimated the complexities involved in executing his vision, much like Napoleon did in his time. Issues such as labor shortages, inadequate infrastructure, and power supply challenges are posing significant obstacles to the project’s progress.

Despite the setbacks, consulting firm McKinsey & Company seems to be benefiting from the project, reportedly earning over $130 million annually for its services. However, there are concerns about potential conflicts of interest, given McKinsey’s involvement in both planning and validating financial projections for the project. A McKinsey spokesperson has assured that the firm follows strict protocols to prevent conflicts of interest in its engagements.