Total investments in Gulf projects across various sectors have crossed $2-trillion, reveals a recent report.
The MEED Projects Index, which monitors investments in construction, oil and gas, power, petrochemicals, waste and water sectors across the Gulf region, has increased considerably in value, touching 40 percent, during the past one year, despite fears that huge construction costs could result in significant fall in the number of new projects.
The General Manager of MEED, Simon Howard, said “Despite the fears that bubble might burst any moment, the business in Gulf continues to boom. The last one year has seen huge investments pouring into the region with developments such as the Saadiyat Island and Masdar City, thereby making Abu Dhabi as a market packed with huge potential, to its rival Dubai, as the bustling tourism hub of the UAE.”
Latest indication reveal that UAE is the biggest projects market in the Gulf, accounting to 37 percent of total project value and registering the highest growth, with total project values rising over 46 percent during the past one year.
Such outstanding success in the UAE also indicates that there is still scope for more investments in the surrounding GCC countries. Kuwait has maximum number of un-awarded contracts, which marks more than 90 percent of all projects planned.
In fact, only a quarter of all projects tracked by MEED are under construction, which implies that one will have to wait through another three to five years of intensive construction activity for the completion of the projects.
According to MEED statement, the series of major realty projects announced during the recent months reinforce the dominance of the sector, pushing up the overall value of projects beyond $2 trillion.
Among the major realty projects are $40bn Sudair Industrial City in Saudi Arabia, $4,2bn Dilmunia mixed-use development in Bahrain, $40bn Masdar City in Abu Dhabi and $12bn Al-Wasl development in Riyadh.
MEED report states that the construction sector accounts for $1,207bn worth of investments, followed by the oil and gas sector with $430bn. Petrochemicals accounted for $135bn, industry with $70bn and Water and Waste management at $40bn.
According to Howard, the $2trillion worth projects registered on the MEED database signifies a major landmark in the region’s development.
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