At the MEED Construction Leadership Summit in Dubai on Wednesday, professional services firm Deloitte said Saudi Arabia led the region in terms of the value of projects in the pre-execution stage, with 38.9% of the total value, followed by the UAE with 34.8%.
Kuwait follows Qatar with 8.22%. Oman accounted for 6.48% and Bahrain 2.97% share of the market.
In order to maintain the momentum in the project pipeline and in the face of austerity concerns, Cynthia Corby, partner, Middle East Infrastructure and Capital Projects Leader, Deloitte, says, “It will be necessary to innovate, perhaps with a drive towards privately financed solutions.”
Besides the oil price slump, the future growth of the projects sector will depend on several factors, including the speed of enacting legislation, restructuring, prioritisation of project plans, and the ability to obtain funding, according to Ed James, director (Content and Analysis) MEED Projects.
“But more importantly, governments’ commitment to maintain spending in the face of falling revenues to keep the economy moving will be a key factor in driving the industry forward through the challenging times,” he said.
Experts forecast huge project investment will still be made between now and the end of this decade. Growing economies across the Gulf region will require improved infrastructure for cities to function and expand as planned, but innovative financing models need to be explored as funding gaps arise because of government budget deficits.
“Significant opportunities still exist and public-private partnerships are high on the agenda as a way to leverage private funding,” said Chris Palfreyman, director, Infrastructure owner/operator, Bentley Systems.