To Diversify Economy, Saudi’s Turn to Startup Cities with New Rules

Nicolai Ouroussoff, architecture critic for The New York Times, recently wrote a piece about new city-scale reform zones in Saudi Arabia. The zones are designed to attract foreign direct investment and a mix of Saudi and foreign workers who might find a new set of rules more appealing than those in traditional Saudi Arabia. The King Abdullah Economic City (KAEC), a 168 square kilometer development with a projected population of 2 million, is one of four zones scheduled for completion by 2030.

In Riyadh, building guidelines specify separation of the sexes. “[R]estaurants have separate dining areas for men and women; banks have separate entrances.” Yet the architects hired to plan one of the new zones, a financial district near Riyadh, are not restrained by these sorts of religiously motivated guidelines. Their charge is to create an environment that will “attract a bit of both Westerners and young Saudis who have traveled abroad.”

The King understands that a failure to diversify economic activity away from oil poses serious problems for Saudi Arabia. The desire for diversification is a major catalyst for reforms, even reforms like those in the new cities that might prompt strong opposition from traditionalists. The Saudi leadership is willing to risk opposition because they believe that the more tolerant rules will successfully attract the workers and professionals that can take the Saudi economy in new directions.

The nation’s first coeducational university opened near the KAEC site last year. Like coeducation, many of the rules in the new zones will resemble those in the housing developments that the American oil company Aramco built for its workers in the 1950s and 60s. In the Aramco camps, women could “walk around unveiled, drive cars, and mingle with men.” But unlike Aramco camps, the new developments will not be enclaves for Westerners. The Times article quotes a Saudi official who says that KAEC is “not an Aramco town — it will have a mix of foreigners and nationals — but Aramco rules. The coeducation, the mixing — they’re tools for bringing about various changes the king wants.”

Because the Saudis will apply the new rules only in new developments, people will not be forced to conform to the new rules against their will, they will have a choice about whether to opt in. The zones are like startups. The Saudis and foreigners to whom the new rules appeal will join, while those who are more skeptical can remain in the traditional system and observe from afar. A quote from a Saudi official reflects this startup dynamic. He says that the zones “are contained developments. Should they succeed they will be contagious. Should they fail it is still contained.”

The “idea is to create islands from which change would seep out, drop by drop, without antagonizing powerful conservative forces within the country.” The opponents of social change in Saudi Arabia understand that this is the King’s strategy. They can see that the startup cities will do more than create isolated enclaves — that they are designed to do for Saudi Arabia what Hong Kong did for China. As a result, the traditionalists are likely to pursue a rearguard action that tightens the rules in the new cities. Ouroussoff’s Times story gives the perspective of the reformers, but also suggests that the struggle with the traditionalists may not yet be over. It will take more than architecture to change Saudi society.