Oil-rich Saudi Arabia unveiled a 26.6-billion-dollar project to build a state-of-the art residential and industrial city, timed with its new membership to the World Trade Organisation. King Abdullah Economic City will be located near the western industrial city of Rabegh on the Red Sea coast, north of the kingdom's second largest city, Jeddah.

"In what is considered the single largest private sector investment in Saudi Arabia, the announcement ... is a signal of the dawn of a new era of economic prosperity for the citizens of the kingdom," Emaar said on Tuesday.

The project was announced at SAGIA's headquarters in Riyadh in the presence of Saudi King Abdullah, Crown Prince Sultan bin Abdul Aziz and Dubai's Crown Prince Sheikh Mohammed bin Rashid al-Maktoum, highlighting the significance attached to the project by the Saudi government.