The project will cover 50 islands and 34,000 square kilometers — an area bigger than Belgium — between the cities of Umluj and Al Wajh to attract “luxury travelers from around the globe,” according to an official statement sent to Bloomberg on Tuesday.

It will be developed by the kingdom’s sovereign wealth fund, with the first work expected in two years.

Saudi Arabia wants to turn hundreds of kilometers of its Red Sea coastline into a global tourism destination governed by laws “on par with international standards” as part of its plan to transform the economy and reduce its reliance on oil.

Bringing sun-seekers to Saudi beaches could transform a tourism industry that relies almost solely on Muslim pilgrims visiting holy shrines in Mecca and Medina. But while the announcement emphasized the economic benefits, past mega-projects to diversify the economy have struggled to get off the ground, and questions are likely to be raised over how acceptable the plan is to the kingdom’s influential religious establishment.

“If you can’t change restrictions on alcohol and dress, that market disappears,” said Crispin Hawes, London-based managing director at Teneo Intelligence, referring to foreign tourists.

Tourists will either not require a visa or will be able to obtain one online. One of the documents referred to the project as a “semi-autonomous” area governed “by independent laws and a regulatory framework developed and managed by a private committee,” a sign that it could ease strict rules applied elsewhere in Saudi Arabia. The kingdom’s austere interpretation of Sunni Islam bans alcohol, imposes a dress code, limits gender mixing and prevents women from driving cars.

The proposal is part of Crown Prince Mohammed bin Salman’s blueprint to prepare the biggest Arab economy for the post-oil era. Authorities are already relaxing rules on entertainment, and by 2030, they aim to double household spending on recreation to 6 percent. Concerts, dance shows and even film screenings have drawn thousands of people over the past year.

The idea of creating separate areas for foreigners with looser rules also isn’t entirely new to Saudi Arabia. The most famous, the Saudi Aramco compound in Dhahran, is designed like an American suburb. On the gender-mixed campus of King Abdullah University of Science and Technology, attended by Saudis, women can drive and wear what they want.

The Public Investment Fund, headed by Prince Mohammed, will inject initial investments into the project and start partnerships with international companies.

The initial groundbreaking is expected in the third quarter of 2019. The first phase will be completed by the fourth quarter of 2022, including “the development of hotels and luxury residential units, as well as all logistical infrastructure — including air, land, and sea transport hubs,” according to the statement.

By Alaa Shahine and Vivian Nereim BLOOMBERG

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