Saudi Arabia: Saudi Arabia’s Red Sea Development Co. plans to close on a SAR14 billion ($3.7bn) loan from five domestic banks by the end of the year as it steps up construction on a luxury tourism project about the size of Belgium, its chief executive said.

The developer has been seeking financing since last year for the project, which stretches across dozens of islands off the kingdom’s west coast. Chief executive officer John Pagano didn’t say which banks would be providing the loans.

So far the company has awarded SAR7bn ($1.87bn) of contracts and plans to award a total of SAR15bn ($4bn) by the end of the year, Pagano said in an interview. A public-private partnership deal for the project’s utilities should be signed within days, and once that’s in place and the financing is secured, capital for the first phase of the project will be committed, he added.

“We’re now starting to ramp up our construction spend so it’s a good time to get the debt facility in place,” Pagano said.

Expanding tourism is a key focus of Crown Prince Mohammed bin Salman’s plan to transform the kingdom’s economy. The twin strains on the budget created by the coronavirus pandemic and lower oil prices haven’t slowed work on two sprawling tourism developments on the Red Sea and an entertainment hub near the capital.

The Red Sea Development Co. project, owned by the kingdom’s Public Investment Fund, is the biggest leisure development, spanning over 10,000 square miles (25,900 square kilometres). Construction on a new international airport for the area has begun, and the company aims to open the first four hotels at the end of 2022 and 12 more the following year, Pagano said. That would complete the first phase of the project.

When the entire development is completed in 2030, it will target one million visitors a year, split evenly between domestic and international, he said.