Pressure piles on to Saudi construction; Workload drops for GCC contractors despite project launches; Saudi Arabia economy buoyed by work on kingdom’s gigaprojects
Saudi Arabia’s projects market is overheating. The volume of projects announced in the past six years vastly exceeds the resources that are available to work in the kingdom.
Combined with tight deadlines to complete projects as part of Vision 2030, the pressure on the construction industry to deliver is ratcheting up and turning the tables on the supply chain as the shift from a buyer’s to a seller’s market accelerates.
For the five years from 2016 to 2020, there was an average of about $14bn-worth of contract awards a year in Saudi Arabia for the construction and transport sectors. After rising to $21bn in 2021, the total rose to $32bn in 2022 – the second-best year on record.
The near doubling of the total annual value of contract awards by the end of 2022 has required a significant scale-up of resources in the kingdom, and the ramp-up is set to continue.
Much of this pressure is due to the five official gigaprojects, which are major programmes of work that will involve a sustained flow of contract awards for years to come. Read more in this month’s Agenda by MEED editor Colin Foreman.
The April 2023 issue of MEED Business Review also includes MEED’s 2023 construction contractor ranking.
Find out who the top 10 GCC contractors are here, and the top contractors by GCC country here.
Our 18-page special report on Saudi Arabia, meanwhile, highlights Riyadh’s progress in turning promises into reality.
While all eyes have been on Saudi Arabia’s Vision 2030 for some time, in the past 12 months the country’s gigaprojects have truly begun to gain momentum, with a surge in spending on infrastructure and associated projects.
We hope our valued subscribers enjoy the April 2023 issue of MEED Business Review.
Must-read sections in the April 2023 edition of MEED Business Review include:
> AGENDA: Saudi Arabia under project pressure
> TURKIYE: Earthquake rebuild to impact Turkish interest in Saudi
> CURRENT AFFAIRS: Iraqi budget may mark new era in Kurdish relations
> CONTRACTOR RANKING: MEED’s 2023 top 10 GCC contractors
> GCC COUNTRY RANKINGS: Top 10 GCC contractors by country
> MEED COMMENTS:
> Industry insiders mull Saudi nuclear move
> Sovereign funds to help deliver railways
> Petchems achieving net zero is steep task
> Dubai high-rise makes a return
> GULF PROJECTS INDEX: Gulf projects market swells by 3.5 per cent
> FEBRUARY 2023 CONTRACTS: Value of signed deals plummets
> INTERVIEW: Aramco keenly eyes digital future with ambition
> INTERVIEW: Kuwaiti firm aims to be oil clean-up leader
> LEADERSHIP: Dubai’s vision for a 20-minute walkable city
> TOP 5 CAUSEWAY PROJECTS: The region’s most ambitious causeway projects
> SAUDI ARABIA MARKET FOCUS: Saudi Arabia picks up the projects pace
> MARKET SNAPSHOT: The outlook for Saudi projects
> BUSINESS OUTLOOK: Finance, oil and gas, construction, power and water contracts
> OPINION: The pros and cons of the biometrics boom