Until recently, the Kingdom of Saudi Arabia was mostly known as one of the leaders in oil production. At the same time, news on the development of the tourist destination in the country regularly appear in the media. One of the largest projects is the resort of The Red Sea Project, which has an area comparable to Armenia or Albania. The Red Sea Development Company (TRSDC) is told about the new travel project of the kingdom. John Pagano in an exclusive interview for Invest-Forsight.
- John, please tell us why such a rich country as Saudi Arabia, which earns enough money on its energy resources, began to develop the tourist destination?
- The solution is dictated by the Vision 2030 strategic plan, in which the main importance is attached to the diversification of the country's economy. Tourism is located in the center of this program, and new developments similar to The Red Sea Project play an important role in stimulating economic growth and creating jobs in the kingdom. According to forecasts, the contribution of tourism in the GDP of Saudi Arabia, which is 3.4% today, by 2030 it will be approaching the average operator in 10%.
Our project, focused solely on tourism, represents tremendous opportunities for the growth of the local economy. The Red Sea Project was created to direct $ 5.8 billion in the Kingdom GDP since 2030, as well as to provide about 70 thousand people to ensure work.
More than 500 contracts have already been concluded for a total of $ 4 billion, 70% of the total value signed by Saudi companies.
- What exactly is your project? What is its cost and where does the financing coming from?
- The Red Sea Project is one of the most ambitious directions of regenerative tourism in the world, uniting a luxurious vacation with untouched nature. It is based on the philosophy of environmental regeneration: we intend to leave the natural environment in the best condition than before the start of work. Our General Plan predicts 30% of the net benefit in terms of energy saving derived from the preservation of the environment. It includes the expansion of the arals of mangroves, algae, corals and ground flora.
A huge resort spreads on the archipelago, consisting of more than 90 uninhabited islands, which frame white sandy beaches. Stunning turquoise waters, wide dunes, sleeping volcanoes, mountain ranges and cultural heritage sites will be available to our guests. Tourists will be able to do diving on the fourth largest system of barrier reefs in the world, to participate in a number of exciting events and relax on beautiful sandy beaches, enjoying the sun and warm sea.
As for financing, there are no problems with him. TRSDC - Closed Joint-Stock Company, fully owned by the State Investment Fund of Saudi Arabia. The first phase of The Red Sea Project is fully financed, we complete work on the execution of a credit line worth about 14 billion rials ($ 3.7 billion) and will soon declare a list of key banks involved in project financing.
At the same time, we are pleased to private investors in various fields of the project. So, in November 2020, we transferred the management of resort life systems with a consortium headed by ACWA POWER. The partnership will provide the first phase of the resort project to obtain 100% renewable energy using the world's largest reputation storage facility. The signing of the Agreement also testifies to the confidence of investors to the project and a consortium financed by Saudi Arabia and international financiers, including Standard Chartered Bank and Chinese Silk Road Fund.
- The resort area is 28 thousand square kilometers. Why was such a large-scale territory been chosen for the project? Will the area be mastered completely or only partially?
- The scale of the project is really impressive, but it is a diverse landscape and untouched nature that attracted us. I was really shocked by natural beauty. The idea of the project is to create a single direction covering the archipelago, which includes more than 90 uninhabited islands and having a diverse landscape so that tourists get a maximum of impressions for one trip. The previously unknown corner of the world will offer a wide range of impressions of nature lovers, adventure seekers in the fresh air and fans of a health recreation.
In total, we are developing less than 1% of the territory of the total volume of 28 thousand square kilometers. In the preparation of our comprehensive development plan, we used scientific and environmental recommendations. This allowed us to carefully select the most suitable construction zones and designate locations that require additional protection. We will leave 75% of the island archipelago intact and make environmental zones on the nine islands.
- The first stage of the project will be completed in 2022. Does the building noise will not interfere with the comfort of vacationers?
- To avoid possible inconveniences for holidaymakers, we build hotels and resorts in Phatepno. For example, our two resorts, Desert Rock and Southern Dunes, will be completed by the end of 2022, and the size of the territory will allow guests to quietly explore those parts on which the construction has not yet begun. The distance between the islands and resorts is mainly measured by tens of kilometers.
We limit noise and light pollution not only for the comfort of our guests, but also to protect wild animals and marine inhabitants who settled up here long before us. Works at night are minimized and, if possible, suspend not to violate the rhythm of the lives of corals, nesting birds, as well as two types of marine turtles under threat of disappearance. The measures will allow to maintain the natural night activity of the local fauna and will ensure the comfort of our first guests, giving them an additional pleasure from our stay.
- Who can afford to rest with you? Is the resort oriented on the millionaires oriented, or will they be able to relax and citizens of the middle class? How much will it cost a week stay at the hotel?
- In addition to tourists who want to safely relax on an elite resort, we expect to attract budget travel lovers. Along with elite hotel, tourists will also access 4-star resorts. We understand that in recent years, recreation conditions have changed: many tourists, in addition to premium services, want to get interesting impressions and get acquainted with the country's culture, explore coral reefs or study the unique cultural heritage of the Red Sea coast Saudi Arabia. For golf lovers, we also have an equipped field with 18 holes.
- How eco-friendly and innovative will be the airport? What are its technical features and advantages? How will transfer from the airport?
- The design of The Red Sea International Airport, developed by the Foster + Partners architectural bureau, focuses on environmental friendliness and is inspired by the breathtaking dunes of the region. Its design is supported by advanced technologies designed to leave tourists an unforgettable experience of the trip at the beginning of the trip. So, after arrival, guests will not need to expect luggage: the intelligent control system itself will send it directly to the room. Also luggage will be sent to the airport to the reverse flight.
The airport will fully function on renewable energy sources, and the innovative climate control system will use natural energy saving methods. For example, the airport will be divided into five mini-terminals, this will allow you to temporarily close its zones off-hours in order not to spend energy on air conditioning of the entire volume. In addition, the inclusion in the territory of the airport of water bodies and vegetation will provide natural cooling.
- What will be innovative in the construction of hotels, in addition to working on renewable energy sources?
- Our design and construction partners, as well as hotel service operators share our values and, if possible, use advanced technologies. Construction plans are designed in such a way as not to disturb the ecosystem of mangrove thickets and other ecosystems. We produce building materials outside the resort, which minimizes the impact on the environment. It is planned that laundry and catering enterprises will be centralized, thereby reducing the area of hotels on the islands and carrying main activity on the mainland. After completing the construction, the resorts will use technologies for careful control of the impact of the human presence on the local environmentally vulnerable environment. We plan to introduce a complete ban on the use of disposable dishes and recycled plastic and follow Zero Waste strategies.
- The resort seems to be environmentally friendly, created for all the rules of green construction. How will the issue with the export of garbage? Where will it be recycled?
- In 2020, we have discovered an innovative eco-friendly complex for the processing of all forms of waste generated at the first stage of construction. Tons of rubble, stone and concrete remaining in the construction of foundations, buildings and infrastructure objects are sorted and crushed by special equipment. Then they are reused for other purposes, for example, for the construction of roads.
As for the household garbage, which leave builders, on the territory of the complex is sorted separately for recycling such waste as glass, plastic, tin cans, paper and cardboard. Then the waste is rechecked, packaged and sent to the mainland for processing. Food and organic waste turn into compost, providing rich in nutrients material for a landscaped nursery with an area of 1 million square meters, created in 2020 specifically for our project. In total, it will provide food more than 15 million plants required for gardening.
After only a minor part of the waste, not subject to recycling and composting, remains. To avoid the formation of landfills, residual waste is burned on special environmentally friendly objects, and the resulting particles and carbon are caught from the atmosphere. The resulting ash is used for the manufacture of bricks.
- In Saudi Arabia, there is a strict code of ethical norms. Will there be rules for the behavior of tourists in the resort differ from the legislative norms of Saudi Arabia? If so, how exactly?
- The territory of the resort is included in a special economic zone, which allows mitigation of social behavior for foreign tourists. In addition, the kingdom now comes in a period of change, and tourism is a strategically important direction of development. We are seeing the growing interest and demand from tourists who want to visit Saudi Arabia. After the long-awaited launch of the electronic visa design system in September 2019, the Ministry of Tourism only issued more than 350 thousand tourist visas and provided access to the kingdom of citizens of almost 50 countries.
- Will, in your opinion, the resort is a significant tourist destination for Russian tourists?
- TRSDC is waiting for an exciting year. As the world is included in the postponical era, we continue to build new partnerships, open up new construction horizons and strive to implement our plans for receiving the first guests at the end of 2022 and we hope that there will be tourists from Russia among them. The resort is convenient from the point of view of logistics: it is located 500 km north of Jeddah, at the intersection of the borders of Europe, Africa, Asia and the Middle East. This means that 250 million people are within a three-hour flight, and 80% of the world's population - within the eight-hour flight to the resort.
Conducted Konstantin Frumkin
Photos provided by TRSDC
Reference: The Red Sea Project project will be built on the territory of more than 28 thousand km2 along the coast of Saudi Arabia and will take an extensive archipelago from more than 90 islands. There are mountain canyons, sleeping volcanoes and ancient objects of cultural heritage. The resort will include hotels, residential real estate, commercial and social infrastructure, cultural and recreation arrangement, as well as auxiliary infrastructure with an emphasis on renewable energy, maintaining and reuse water resources. Upon completion of construction, in 2030, The Red Sea Project will have 50 resort complexes offering up to 8 thousand hotel rooms, and about 1.3 thousand residential real estate facilities on 22 islands and six continental sites. The resort area will include luxurious marina, golf courses, recreational and cultural and entertainment facilities. The general plan for construction provides for development of 25% of the territory, leaving the remaining remaining 75%.