The Mediterranean city state of Monaco has shelved a multi-billion-dollar scheme to expand into the sea because of the global economic crisis, its ruler Prince Albert II said Tuesday.

Albert said Monaco had been forced to drop plans to build a huge artificial peninsula, which had been compared to Dubai’s island developments.

“In the current climate it would be irresponsible to launch a project of this scale,” the prince told AFP in an interview, explaining that the project had fallen short of its funding and environmental protection goals.

“The international crisis has forced us to seek better financial guarantees, more security. I would in any case want to reassure myself that effects on the environment would be as limited as possible,” he said.

The decision will disappoint two of the world’s best known architects, who were competing to design an offshore platform as large as 20 football pitches and costing between five and 10 billion dollars (7.7 billion euros).

Monaco is the world’s most densely populated state, and there is little room for new building on its narrow strip of dry land trapped between a steep hillside and the seafront. The project would have increased Monaco’s territory – two square kilometres of luxury housing, a famous casino and plush yachting marinas, which host an annual Formula 1 Grand Prix race – by five percent.