Dubai still has more than $216 billion (Dh792.72) worth of infrastructure projects under construction and about $270bn worth of projects in the pipeline or under bid, according to Meed Projects, the online project tracking database.
"Despite the worst global recession to date, the GCC has more than $1.3 trillion worth of announced and un-awarded projects and a further $1.4trn worth of schemes in the wider Middle East, according to latest data," said the release from the organisers of the Arabian World Construction Summit (AWCS) that will start from today at the Abu Dhabi National Exhibition Centre.
The event is part of the Arabian Construction Week that will take place until May 26, incorporating four dedicated vertical trade exhibitions - future build, civil engineering, building machinery, and the green building expos.
The analysis also indicates an uncertain outlook for the UAE construction sector with more than $425bn worth of construction and infrastructure projects put on hold or cancelled since the start of the market downturn in the fourth quarter of 2008. Of these, just under $300bn are located in the emirate, compared with its neighbour Abu Dhabi that has seen close to $49bn worth of projects postponed or cancelled, though the overall picture is bright it added.
Of particular interest at the event is Saudi Arabia, which has overtaken the UAE to become the largest project market in the region with more than $435bn worth of projects planned over the next five years.
Edward James, Head of Meed Insight, Meed's research and analysis arm, said: "Saudi Arabia represents the most obvious opportunity for contractors to focus on thanks to its emphasis on infrastructure, education and utilities fuelled by high oil revenues and strong demographic growth. However, companies looking to enter the market need to be aware that it remains dominated by local contractors, and that there are unlikely to be any quick wins. It may be that partnering and joint ventures are the most likely route to success."
"At the same time, the long-term growth in energy demand will mean that national oil companies will need to continue investing in upstream and downstream projects. For contractors looking for new income streams, it would be worth building up expertise outside the construction sector to ensure they can compete for these different types of project."
According to data from Meed Projects, the region is confident of other promising growth factors particularly with oil and gas performing strongly. In 2009, more than $55bn worth of hydrocarbons projects were awarded, double the amount of work signed in the previous two years combined. This year is expected to be just as high, if not higher than last, with more than $11bn worth of contracts already awarded.
Buoyed by rising population levels, the utilities sector has barely been affected by the global crisis and indeed grew last year; close to $35bn worth of power sector contracts were awarded in the GCC in 2009 compared with some $29bn awarded the previous year.
By Staff Writer
© Emirates Business 24/7 2010
