Joint venture to develop major Red Sea port is scrapped because of drop in costs

King Abdullah Economic City

UAE developer giant Emaar Properties has pulled the plug on a major contract with Saudi Binladin Group in Saudi Arabia. Its Saudi based company Emaar Economic City (EEC) has cancelled a $373m (£225M) contract awarded to SBG in 2008, due to a drop in costs, according to Reuters.

Dubai-based Emaar Properties is a major shareholder in EEC and had agreed to set up a joint venture with SBG to finance, develop and operate a major port on the Red Sea coast, as part of the development of King Abdullah Economic City (KAEC).

KAEC is the most prominent among a series of "economic cities" that are part of Saudi Arabia's plan to diversify the country's oil and gas-based economy and provide more jobs for the country's growing population.