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Projects awarded in the six-nation Gulf Cooperation Council (GCC) in the first half of 2025 tumbled by nearly 39 percent mainly due to a sharp fall in Saudi Arabia, a Kuwaiti-based investment consultancy firm has reported.
The value of these contracts dipped to around $86 billion in the first half from nearly $140.5 billion in the first half of last year, Kamco Invest said on Thursday.
“The decline was largely due to the substantial reduction in project activity in Saudi Arabia during the period,” the firm said in a report on awarded contracts in GCC states of Saudi Arabia, Kuwait, Qatar, Bahrain, Oman and the UAE.
In the second quarter of this year, the value of such contracts fell by nearly 58 percent to around $28 billion from $68 billion in the second quarter of 2024.
“It was the lowest figure recorded in the past 14 quarters. This downturn was primarily driven by a sharp contraction in project awards in Saudi Arabia, accompanied by a similarly weak performance in the UAE, which experienced a significant year-on-year (y-o-y) decline in contract awards during the period,” the report said.
It noted that the sharp fall in project activity in the GCC follows two years of record spending, during which the region invested heavily in large-scale oil and gas developments along with a $1 trillion-plus giga projects programme in the Kingdom.
Sector-wise, the GCC construction industry recorded a 60.0 percent y-o-y drop, with awards falling to $8.2 billion in the second quarter of this year from around $20.5 billion in the same period of last year.
This was followed by the oil sector, which saw a 98.4 percent y-o-y decline to around $70 million from $4.5 billion in the same period, the report said.
“The construction and oil sectors were the primary contributors to the overall decline in GCC project awards during the second quarter of this year.”
On a quarterly basis, Saudi Arabia’s total contract awards plummeted by 72.5 percent y-o-y to $9.8 billion from $35.5 billion.
In contrast, Kuwait recorded a relatively modest 9.8 percent y-o-y decline in aggregate project awards, reaching $1.8 billion against $two billion.
The UAE, the second largest Arab economy after Saudi Arabia, posted a 47.0 percent y-o-y drop in contract awards, totaling $14 billion in the second quarter of this year, down from $26.4 billion in the corresponding period of 2024.
GCC states, which control over two thirds of the world’s proven oil deposits, are the largest spenders in the Arab region, relying heavily on crude export earnings.
The six members projected spending this year at around $542 billion compared with nearly $529 billion in 2024, according to the GCC secretariat.
(Writing by Nadim Kawach; Editing by Anoop Menon)
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