Why the World’s Largest Megaproject Collapsed | WSJ

Overview

Wall Street Journal reporting argues that Saudi Arabia’s NEOM megaproject—originally sold as a near–science fiction transformation designed to move the country beyond oil—has effectively collapsed across its major components. The story centers on how construction across NEOM stopped or wound down over the past year, supported by internal documents, satellite images, and accounts from former employees describing a mismatch between the project’s fantastical ambitions and its financial and technical realities.

Core claims and findings

NEOM’s flagship vision (“The Line”) proved financially unworkable

• NEOM’s centerpiece was The Line, described as twin linear skyscrapers intended to house about 9 million people, stretching roughly 70 miles, with segments cut through mountains.
• The WSJ report says construction on key elements paused or ended.
• Restarting major components is described as too costly.

Evidence from satellite imagery and former workers shows abrupt stoppages

The report cites satellite images showing major excavation and foundation work (including trenches and other infrastructure) followed by a late-year halt.

Similar patterns are described for:

• Trojena (a desert ski/resort concept) Sites progressed, including major steel work, then workers were told:

  “Construction has stopped. We’re moving out.”

• Sindalah (high-end resort island) Some completed elements deteriorated (e.g., a golf course turned brown), while other planned areas—such as facilities intended for a Four Seasons—saw little to no progress.

Saudi officials frame the slowdown as “re-prioritization,” not cancellations

• The WSJ report notes that Yasir Al-Rumayyan (head of the Saudi Public Investment Fund (PIF), which controls NEOM) said no projects were canceled, describing changes as prioritization.
• However, WSJ also reports that contract cancellations became public in late 2024/into 2025, including reports of cancellation of two NEOM contracts in Saudi Arabia.

Financial deterioration and accounting/write-downs

Large impairments and write-downs suggest major capital strain

WSJ highlights NEOM-related accounting impacts:

• 46.8 billion Saudi riyals written off in 2025
• 74.7 billion written off in 2024

The report equates these to roughly:

• ~$12B in 2025
• ~$17B in 2024

It argues NEOM has already consumed well over $50B, with additional billions expected just to wind down.

NEOM’s internal finances are hard to verify publicly

While the PIF publishes financial statements, it reportedly does not provide enough NEOM-specific detail to allow robust independent assessment.

How the collapse is explained: “delusion” vs reality

Early design relied on expansive, sometimes unrealistic concepts

WSJ says NEOM’s early approach involved assembling top consultants and generating extensive ideas—including themes such as an artificial moon and weather-control concepts—which then fed into major subprojects.

Internal documentation reportedly flagged barriers early—especially cost

A WSJ-obtained report allegedly lists concerns across environmental impacts, livability, architecture, and buildability, with “cost will be astronomical” singled out as a key internal issue.

A reported “dance of mutual delusion” constrained truthful feedback

The WSJ narrative emphasizes governance and incentives:

• MBS (Crown Prince Mohammed bin Salman) is portrayed as a central driver—serving as developer/banker figure, chair of NEOM, chair of key boards, and controller of the PIF that funds NEOM.
• The report argues subordinates and systems encouraged continued pursuit of impossible goals rather than candid plan revisions.

Allegations of internal financial manipulation

An internal audit draft reportedly found manipulation of financials

WSJ says it reviewed a draft internal audit indicating conscious manipulation of NEOM’s financials. Former employees described similar behavior as common.

Costs ballooned, while projections were adjusted to make projects appear profitable

Using Trojena board materials from 2023, WSJ reports:

• Trojena costs were shown as rising to $39B
• To satisfy a requirement that projects be profitable for the state/Crown Prince, staff allegedly increased projected revenues without corresponding on-the-ground changes

Example cited:

• A glamping concept’s projected nightly price reportedly changed from $216 to $704.

Scale of funding required vs national capacity

Revised end-state estimates were vastly larger than initial public framing

WSJ cites a draft board presentation stating the capital required to complete NEOM to its envisioned end state by 2080 was $8.8 trillion—about 25+ times Saudi Arabia’s then-current annual national budget.

NEOM disputes the interpretation

A NEOM spokesperson reportedly said WSJ misinterpreted/misrepresented the figures but declined to provide further detail.

What NEOM is said to be doing now

• WSJ reports that NEOM leadership has shifted focus toward Oxagon (an advanced port/logistics and manufacturing concept).
• Other major projects are described as being wound down or scaled back.

Bottom line

The WSJ coverage portrays NEOM as a megaproject that collapsed because its ambitions exceeded practical and financial constraints, reinforced by internal governance dynamics that discouraged truthful assessment. Financial write-downs, halted construction visible in satellite imagery, contract cancellations, and alleged financial manipulation are presented as evidence of a fundamental breakdown between vision and reality.

Presenters / contributors

• Wall Street Journal (reporting; specific on-screen presenter not identified in the subtitles)
• Yasir Al-Rumayyan
• Mohammed bin Salman (MBS / Crown Prince)