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Jeddah Central Project Set to Be Prominent Development Project in Kingdom’s Vision 2030

Jeddah Central Project will push the Saudi city into a development movement that will enhance its presence among the top 100 global cities (Asharq Al-Awsat)
Jeddah Central Project will push the Saudi city into a development movement that will enhance its presence among the top 100 global cities (Asharq Al-Awsat)
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Jeddah Central Project Set to Be Prominent Development Project in Kingdom’s Vision 2030

Jeddah Central Project will push the Saudi city into a development movement that will enhance its presence among the top 100 global cities (Asharq Al-Awsat)
Jeddah Central Project will push the Saudi city into a development movement that will enhance its presence among the top 100 global cities (Asharq Al-Awsat)

Saudi Arabia’s Crown Prince Mohammed bin Salman bin Abdulaziz launched a development plan for the Jeddah Central Project on Friday. The undertaking sets out to be one of the most prominent development projects of the Kingdom’s national program for transformation, Vision 2030.

It aims to develop the city of Jeddah in support of its ambitions to become one of the top 100 cities in the world.

The project will contribute to developing a vital area suitable for recreation, entertainment, and shopping, transforming the city into a unique destination for various segments of society, including residents and visitors.

The project will be implemented by the Public Investment Fund’s Central Jeddah Development in three phases, the first of which will be completed by the end of the year 2027.

Downtown Jeddah will then begin to receive residents and visitors from inside and outside the Kingdom.

The project aligns with the Kingdom’s Vision 2030, especially developing tourism sites that live up to the highest international standards. It also provides investment opportunities that contribute to the development of the private sector and the tourism, hospitality, and entertainment sector.

In addition, the city will benefit from the building and development of modern residential areas, encompassing 17,000 residential units and diversified hotel projects that offer more than 2,700 hotel rooms, and the provision of integrated solutions for the business sector.

The project will feature a world-class marina and stunning beach resorts, as well as restaurants and cafes and diverse shopping options.

The waterfront of the project is 9.5 km long, which includes a promenade, a marina to host local and international yachts, and a 2.1 km long beach. Open spaces and public services make up a significant part of the project area, with the provision of designated walking areas to create a walkable environment.

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Vujcic: ECB Should Not 'Overreact' if Inflation Edges Below 2%

FILE PHOTO: The European Central Bank (ECB) in Frankfurt, is photographed during a heavy rain storm ahead of the ECB council meeting later this week, Germany, March 14, 2023. REUTERS/Kai Pfaffenbach/File Photo
FILE PHOTO: The European Central Bank (ECB) in Frankfurt, is photographed during a heavy rain storm ahead of the ECB council meeting later this week, Germany, March 14, 2023. REUTERS/Kai Pfaffenbach/File Photo
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Vujcic: ECB Should Not 'Overreact' if Inflation Edges Below 2%

FILE PHOTO: The European Central Bank (ECB) in Frankfurt, is photographed during a heavy rain storm ahead of the ECB council meeting later this week, Germany, March 14, 2023. REUTERS/Kai Pfaffenbach/File Photo
FILE PHOTO: The European Central Bank (ECB) in Frankfurt, is photographed during a heavy rain storm ahead of the ECB council meeting later this week, Germany, March 14, 2023. REUTERS/Kai Pfaffenbach/File Photo

The European Central Bank should not "overreact" to euro-zone inflation edging below its 2% target as there are good reasons to believe it will come back up, ECB policymaker Boris Vujcic told Reuters.

The ECB cut interest rates on Thursday for the eighth time in a year but signaled at least a policy pause next month, despite projecting inflation at just 1.6% next year. Inflation in the 20 countries that share the euro was 1.9% in May, according to a flash reading published last week.

Vujcic, who is also Croatia's central bank governor, said price growth was likely to bounce back later and that monetary policy should not try to do "precision surgery" on small fluctuations from its goal.

"A few tens of basis points' deviation on either side of the target is not a problem," Vujcic said in an interview on Saturday in Dubrovnik. "Because you will always have small deviations. If you consider them as a problem, then you will overreact. This is not precision surgery."

Vujcic said it was reasonable to expect inflation to edge back up as energy prices find a bottom and the economy accelerates. Euro strength is also unlikely to have second-round effects on prices unless it lasts several quarters, Vujcic said.

Some ECB policymakers, especially Portugal's central bank governor Mario Centeno, worry that euro-zone inflation may slow too much.

Vujcic said he sees the risks surrounding the inflation outlook as "pretty balanced" but cautioned there was "complete uncertainty" surrounding global trade tensions with US President Donald Trump's administration.

Vujcic recalled advice he received as a young deputy governor from then-Federal Reserve Chair Alan Greenspan: a high rate of inflation was more dangerous than a low one. Greenspan cited two decades of relatively benign deflation in the late 19th century, which was partly due to improvements in productivity, Vujcic said.

"Nobody cared about low inflation because of the productivity growth," he said. "You have a monetary policy problem to bring it up. Yes, but why would you insist so much if you don't have a problem in the economy?"

The ECB is reviewing its long-term strategy, including the role of massive bond purchases, or quantitative easing, in reviving inflation when it is too low.

The ECB injected some 7 trillion euros ($8 trillion) of liquidity into the banking system through QE and other tools over the past decade. These schemes were blamed for inflating bubbles in real estate and setting up the central bank for sizeable losses.

"The next time around, people will take the lessons from the previous episode, and I think that the bar for QE would be higher," Vujcic said.

He said QE could help stabilize dysfunctional markets - such as during the 2008 financial crisis and the COVID-19 pandemic - but if used "for years and years to try and bring inflation up, its marginal efficiency declines".

Such calls for self-criticism are shared by some policymakers in the ECB's hawkish camp. But sources told Reuters they were unlikely to feature in the ECB's new strategy document, to be published this summer.