A new study reveals the UAE has raced past Saudi Arabia to become the biggest construction market in the Middle East for the first time since 2008.
The report by accountancy firm Deloitte reveals that contracts worth USD 16.2 billion were awarded in the Emirate last year. Compared to Saudi Arabia’s spend of about USD 15.6 billion, the total spending was around 4 percent higher in the UAE. After experiencing difficult times in the aftermath of global financial turmoil, the UAE’s construction market has made swift recovery and topped the ranking for first time in four years.
Last year, the UAE awarded a major infrastructure contract worth Dh 11.75 billion to build the Midfield Terminal Building project at Abu Dhabi International Airport. The Emirate also cleared backlog of several other projects that were suspended following the global financial crisis. In comparison, Saudi Arabia’s largest construction deal was related to the expansion of Masjid Al-Haram mosque in Mecca. After completion of the USD 1.5 billion project, the mosque will boast a capacity of 1 million worshippers.
According to Cynthia Corby, an audit partner at Deloitte; “The expectation with this data was that Saudi Arabia would top the list in terms of the value of contracts awarded but in the end that just wasn’t the case for 2012. Many of the major contracts there have not yet been awarded or were awarded in 2013. Meanwhile in the UAE 2012 saw a backlog of contracts delayed by the financial crisis finally awarded.”
Qatar and Kuwait remained the third and fourth most active GCC construction markets, respectively. Qatar completed deals worth an estimated USD 10.4 billion last year, while its infrastructure-related spending is expected to surge past USD 150 billion as it prepares to host the 2022 FIFA World Cup. Kuwait concluded deals equaling about USD 8 billion last year, which include the Subiya Causeway. Transport construction made up about 76 percent of total construction spending in Kuwait.