The economic output of the UAE’s construction industry is expected to expand by 4% in real terms in 2024 and 4.2% in 2025 according to a report by GlobalData.

The increased output is supported by developments in infrastructure, energy and utilities and residential construction projects. According to regional projects tracker MEED Projects, which tracks contract awards, there were a record $95bn of contracts across all sectors, including construction, transport, oil, gas, petrochemicals and industry.

 

The government’s investment under the latest budget is also expected to support growth in the future. In October 2023, the UAE government approved a AED64.1bn ($17.5bn) budget for 2024, an increase of 1.6% compared with the previous budget.

Investment through public-private partnership (PPP) is expected to support the construction industry’s output. In December 2023, Dubai’s Roads & Transport Authority (RTA) approved a total of ten projects worth AED2.5bn ($680m) under the PPP scheme for 2024-26.

Over the remainder of the forecast period, the UAE’s construction industry is expected to register an annual average growth of 3.8% from 2026 to 2028, supported by investments on transport, renewable energy, housing, and tourism projects. In January 2024, RTA prequalified six consortiums to bid for the contract to design and construct Dubai Metro’s new Blue Line.

Investment under the Strategic Plan 2023-2030 will support the industry’s output over the forecast period. The strategic plan is based on five objectives to facilitate the development of roads and transport systems, along with focusing on expediting the migration to zero-emission mobility by 2050.

The construction industry’s growth over the forecast period will also be supported by UAE government initiatives, such as Energy Strategy 2050, Masdar City Development Programme, the Sheikh Zayed Housing Programme, and the Dubai Tourism Strategy.



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