JEDDAH, 20 August 2006 -- Many international companies are expected to attend a major conference early next year to be organized by Emaar Economic City (EEC), a consortium led by Emaar Properties, to promote investment in the SR100 billion King Abdullah Economic City (KAEC), the largest single private sector project in the Kingdom.

Informed market sources said a number of consortiums comprising Saudi and international companies would vie for contracts to carry out various projects in the city, especially in technological and petrochemical sectors.

Custodian of the Two Holy Mosques King Abdullah has shown special interest in the project as he visited its site in Rabigh, about 200 kms northwest of Jeddah, last week to see how it was progressing. The king officially launched KAEC at the headquarters of Saudi Arabian General Investment Authority (SAGIA), the project's prime facilitator, in Riyadh on Dec. 20, 2005. The sources also pointed out that a Turkish delegation would visit the Kingdom within two months to explore investment opportunities in the city, especially in the contracting sector.

Agreements have been signed with Japanese companies to establish a number of plastic industries and training institutes in the city at a total cost of $6 billion, Al-Madinah daily reported quoting the sources. The accords were signed during Crown Prince Sultan's visit to Tokyo, the paper said.

Covering an area of 55 million square meters, the economic city will undertake mixed-use developments in six components: a modern world-class seaport, industrial district, financial island, educational and healthcare zone, resorts and the residential area. The overall project will be completed in stages, with the first batch of commercial houses and residents expected to take possession within 30 to 36 months.

Infrastructure works at the city are in progress. Excavation work for the first city canal to run through the Red Sea Village has started. Geotechnical investigations are being conducted for residential units, and designs have been drawn for one of the main entry gates. Work is also under way on the project's first boulevard -- a 15-km-long stretch that features over 3,000 palm trees.

Muhammad Al-Baitar, supervisor of the project, said works were also progressing on desalination, sewage and air conditioning units. "Efforts are also under way to establish an electricity power plant with 10 generating units, each with a capacity of 1,200 kilowatts," he explained. Saudi youths in Rabigh are optimistic that the new economic city would create a lot of job opportunities for them and improve their financial condition. KAEC is expected to generate 500,000 jobs.

EEC's initial public offering was a big success as more than 10 million Saudis bought its shares, breaking the previous record achieved by Yanbu National Petrochemical Company (Yansab). "EEC drew 1.1 million more subscribers than Yansab," the Saudi Capital Market Authority said.

Mohamed Ali Alabbar, chairman of EEC, thanked the investors for their tremendous response. "The overwhelming appreciation for EEC shares is a true indication of emerging investor appetite and trust in the King Abdullah Economic City project," he added.

By P.K. Abdul Ghafour

© Arab News 2006