GCC construction sector begins recovery as economies open up

The GCC construction market has begun to recover in July after a poor performance in the previous months of pandemic, the latest data from BNC intelligence showed.
The regional construction market, which is estimated at $2.4 trillion with more than 22,000 active projects, made a smart recovery, recording $11.6 billion worth of new projects announced in July as compared to $11.9 billion for the whole of second-quarter.
The increase in activity is attributed to regional countries started to ease restrictions imposed to counter the spread of Covid-19. Projects worth $30.7 billion achieved construction completion while new projects worth $11.6 billion were announced in July.
While contracts worth $4.1 billion were awarded in the GCC with the UAE and Qatar contributing 52 per cent and 28 per cent, respectively
"July marked the beginning of the post-Covid awakening for construction in the GCC, thankfully ending the Q2 hibernation," said Avin Gidwani, CEO of Industry Networks. "As your business awakens, take nothing for granted and stay away from the temptation of using the past to forecast the future."
Rizwan Sajan, founder and chairman of Danube Group, recently said the worst is over and outlook for the sector is good.
"With the opening of the economies, we can see a lot of activities, despite the summer season. The economic activities and construction works will grow hand-in-hand from now on. So, we are excited about the prospects. The second half of the year will obviously be much better as business confidence and business activities are up," said Sajan.
BNC said mega projects were announced in Saudi Arabia and Oman including the $5-billion Green Hydrogen-Based Ammonia Production Facility in the Neom Economic Zone, the $2 billion mixed-use development announced for Durrat Al Nakheel in Al Khobar and the $1.5 billion Low Sulphur Fuel Oil (LSFO) Refinery in Oman.
Saudi Arabia drove new announcements in July with $8.4 billion worth of new scheme announcements, followed by Oman with $2.2 billion worth of new announcements. The industrial sector contributed 44 per cent of the total value of new project announcements followed by the urban construction sector with 35 per cent contribution.
waheedabbas@khaleejtimes.com