VZCZCXRO6841
PP RUEHDE
DE RUEHJI #0437/01 1820730
ZNR UUUUU ZZH
P 010730Z JUL 06
FM AMCONSUL JEDDAH
TO RUEHC/SECSTATE WASHDC PRIORITY 9264
INFO RUEHZM/GULF COOPERATION COUNCIL COLLECTIVE PRIORITY
RUEHLO/AMEMBASSY LONDON PRIORITY 1429
RUEHFR/AMEMBASSY PARIS PRIORITY 1507
RUEHRH/AMEMBASSY RIYADH PRIORITY 6593
RUEAIIA/CIA WASHDC PRIORITY
RUEKJCS/DIA WASHDC PRIORITY
RHEHAAA/NSC WASHDC PRIORITY

UNCLAS SECTION 01 OF 03 JEDDAH 000437 
 
SIPDIS 
 
SIPDIS 
 
RIYADH, PLEASE PASS TO DHAHRAN; DEPARTMENT FOR NEA/ARP; 
PARIS FOR ZEYA; LONDON FOR TSOU 
 
E.O. 12958: N/A 
TAGS: ECON KISL PREL SA
SUBJECT: JEDDAH MAYOR PRESENTS DEVELOPMENT PLANS; CONSUL 
GENERAL MAKES BID FOR MUNICIPAL ASSISTANCE IN SEARCH FOR 
NEW CONSULATE SITE 
 
REF: JEDDAH 269 
 
¶1.  SUMMARY:  On June 19, the Consul General, Pol/Econ Chief, 
Commercial Officer , PolOff and EconOff attended the June 
General Meeting of the American Businessmen of Jeddah (ABJ). 
The keynote speaker was Mayor of Jeddah, Adel Fakeih who 
described the city's ambitious new redevelopment plan to 
transform Jeddah into a modern, efficient and prosperous 
"world-class" city.  After the meeting, the CG spoke with the 
mayor about the mission's arduous search for a site to build 
a new consulate compound.   The CG enlisted the mayor's 
support for solving a title dispute involving one potential 
site.  END SUMMARY. 
 
JEDDAH:  WORLD-CLASS CITY OF THE FUTURE 
 
¶2.  The CG and a number of Consulate staff attended the June 
19 meeting of the ABJ.  Due to the oppressive heat of summer 
which drives most well-to-do Jeddawis from the country, this 
was the final meeting of the ABJ year.  As is traditional at 
this meeting, a high-profile speaker appeared, in this case 
Jeddah's Mayor Adel M. Fakieh.  In his speech, "The Jeddah 
Plan and Future Investment Opportunities," Mayor Fakeih 
offered a guided tour of the grandiose Municipal Plan to 
redevelop Jeddah and create a "world-class" city.  The plan 
was developed with the assistance of international 
consultants and advisors.  The description of the Jeddah 
Plan, illustrated by dramatic renderings of a cityscape that 
could rival Dubai or Singapore, placed a heavy emphasis on 
infrastructure, planned construction, and economic and 
technological development. 
 
INFRASTRUCTURE IMPROVEMENTS KEY TO FUTURE PLANS 
 
¶3.  Anyone who has endured the increasingly heavy and 
disorderly traffic plaguing Jeddah can only applaud the 
municipal plan's comprehensive, integrated transportation 
system.  The plan envisions drastic revision to traffic 
patterns by rerouting a number of major traffic arteries, 
development of a modern public transit system, and 
interconnection with a regional transportation network, 
including the proposed Mecca-Medina Rail link and Landbridge 
which would connect Jeddah with the proposed national rail 
network.  Note:  Considering the frequent, unanswered 
complaints about the atrocious state of many of Jeddah's 
roads, one must wish them quick success, but could be excused 
for harboring some skepticism.  End Note. 
 
¶4.  One questioner in the audience raised the issue of water 
and sanitation in Jeddah which have been reported on before 
(reftel).  The Mayor assured the audience that this problem 
was being addressed in the current budget in cooperation with 
the national authorities, and would be solved at the 
conclusion of the current five-year plan.  He noted that 
thanks to the acceleration of capital investment programs 
permitted by increased oil revenues, the entire five-year 
plan to develop a modern, safe water and sanitation system 
had been completely funded to the projected total of SR 7 
billion.  He also announced that all contracts associated 
with the water and sanitation plan would be awarded by the 
end of this year. 
 
¶5.  A substantial portion of the real estate in Jeddah is 
owned by the municipality.  Under the proposed plan, 
substantial development will be concentrated in north Jeddah 
in the vicinity of the now developing Obhur Creek region, the 
area surrounding the old Jeddah airport, and several areas 
located between the Old City and the current location of the 
U.S. Consulate General.  Significant portions of the 
Corniche, particularly near the Lagoon and the Islamic 
Seaport, also are slated for redevelopment. 
 
ZONING WILL ENSURE ECONOMIC VIABILITY AND CONSERVATION 
 
¶6.  The city plans to use zoning regulations to ensure that 
economic activity in expensive commercial sections will 
"increase the value to the city," by transferring economic 
benefit to areas where development will be restricted, such 
as the Balad, the Old City of Jeddah.  As described by the 
mayor, the city is exploring ideas such as trading height 
credits, whereby a developer desiring to build a high-rise 
 
JEDDAH 00000437  002 OF 003 
 
 
building on the exclusive Corniche would have to buy the 
height rights from an area such as the Old City, thus 
maintaining the economic viability of the historic small 
buildings in the Old City in the middle of a modern 
commercial metropolis. 
 
PUBLIC PRIVATE PARTNERSHIPS AND TRANSPARENCY 
 
¶7.  The mayor explained that much of the development will be 
carried out by public-private partnerships, which will be 
open to international investors and participants.  During the 
speech, he announced that within the next two or three months 
the Jeddah Development Commission would be established to 
enter into a "dialogue with businesses interested" in 
participating in the project.  These partnerships are also 
viewed as a method of circumscribing what he candidly 
characterized as an ineffectual, unresponsive and corrupt 
bureaucracy.  COMMENT:  While methods to overcome 
bureaucratic obstacles are to be welcomed, the actual 
operation of these organizations should be carefully 
scrutinized in a land long know for "wasta" (the exercise of 
influence, kickbacks, sweetheart deals, and silent partners) 
to ensure that the operations are genuinely transparent.  END 
COMMENT. 
 
FARTHER IN THE FUTURE:  TRANSFORMATION OF GOVERNMENT AND 
MEGAPROJECTS 
 
¶8.  In the more distant future the Mayor also envisions the 
transformation of the physical city being accompanied by a 
transformation of the city's operations.  He hopes to 
incorporate technology into municipal activities and 
inaugurate e-government.  He also referred to the possibility 
of additional projects in the vicinity of Jeddah.  He 
described the recently inaugurated expansion plans for King 
AbdulAziz International Airport and hinted at a "megaproject" 
north of Jeddah.  Since King Abdullah Economic City, planned 
for Rabigh, has been publicized extensively during the past 
year, it is presumed that this statement refers to some as 
yet unannounced project that the ambitious Saudi government 
is considering as an investment for their ever growing 
petroleum revenues. 
 
BEST LAID PLANS:  WHAT WILL THE PUBLIC SAY? 
 
¶9.  Substantial time and money have been expended in 
developing these elaborate plans.  The opinions of the 
powerful business community and the appropriate government 
entities have been combined with the assistance of 
international consultants and planners.  What is uncertain is 
how the public will accept this plan which will inevitably 
displace thousands of them from their homes and businesses in 
the core areas of the city in order to permit redevelopment. 
In response to a query from Pol-Econ Chief after the meeting, 
Mayor Fakeih said that the plan would soon be open to public 
comment.  One must question how much modification could occur 
in a plan that has already reached such an advanced state. 
 
¶10.  COMMENT:  Formulation of the Jeddah Plan exposes the 
distance Saudi Arabia remains from successfully incorporating 
democratic principles in public policy-making.  The appointed 
mayor, the municipal bureaucrats, the national government, 
and the influential business interests have shaped this 
project, with the assistance of international experts.  Only 
in the future, will the general population, who will have to 
endure its consequences, have an opportunity to offer their 
opinions.  END COMMENT. 
 
THEN THERE IS THE COMPETITION 
 
¶11.  One wonders how the promotion of an already thriving 
Jeddah into a "world-class" commercial center will fare as 
the proposed King Abdullah Economic City is developed in 
Rabigh north of Jeddah and future developments announced for 
Yanbu are also carried out.  Can the central west coast of 
Saudi Arabia support three major commercial centers?  Have 
the many development projects announced for these areas in 
the past year been coordinated? 
 
CG BRIEFS MAYOR ON NEW CONSULATE GENERAL PLANS 
 
 
JEDDAH 00000437  003 OF 003 
 
 
¶12.  In a conversation after the Breakfast, the Consul 
General briefed the Mayor on the ongoing search for a 
suitable location for construction of a new Consulate 
General.  The CG described the three sites presently under 
consideration; two in north central Jeddah and one north of 
Obhur Creek on the northern outskirts of the city.  In 
discussing a title dispute between the municipality and the 
owners of one parcel under consideration, the CG reminded the 
mayor of his earlier pledge to do whatever he can to 
facilitate the Mission's search for a proper site for a new 
consulate.  The CG also informed the mayor of Ambassador 
Oberwetter's personal concern that this matter be settled 
expeditiously. 
 
MAYOR'S ROAD TO OFFICE 
 
¶13.  (SBU)  Fakeih, dressed in traditional Arabic attire, 
used excellent English peppered with occasional Arabic 
phrases to deliver a polished PowerPoint presentation of his 
plan to revitalize Jeddah.  He noted that he hopes to use 
technology to fight corruption and to improve the city's 
service capabilities.  During his speech, he also credited 
his wife, Maha Fitaihi (a prominent businesswoman and social 
figure in Jeddah who was seated on the CG's right hand) with 
encouraging him to take the mayorship as a way to give back 
to his community.  Fakeih said he initially had "shied away" 
from government posts but was convinced to become Mayor by 
his wife's continued support and after being personally 
tapped by Minister of Municipal and Rural Affairs Prince 
Mitib bin Abd al-Aziz Al Saud.  The Mayor also said that 
while he takes satisfaction in serving Jeddah and not just 
building business, in the end he still sees himself as a 
businessman and not a bureaucrat. 
BIOGRAPHICAL NOTE 
 
¶14.  Fakeih has a bachelor's degree in industrial engineering 
from King Abdulaziz University in Jeddah.  He has been a 
prominent member of the Jeddah business community for many 
years.  He was chairman of the Savola group, a Jeddah 
industrial conglomerate specializing in supermarkets and food 
products, from 1990 to 2003 and then was chairman of the 
Jeddah Chamber of Commerce and Industry (JCCI) during 
2003-2005.  He has been active in many civic organizations in 
Western Saudi Arabia, including serving on the executive 
boards for the Mecca Area Board, the Supreme Council for 
Tourism, the Royal Committee for Jubail and Yanbu, the MARAE 
industrial group, and a prominent development fund.  He also 
has been chairman of the Saudi Arabian Glass Company.  Fakeih 
has 5 children. 
Gfoeller