Projects in the Middle East are slowly but gradually coming back on stream after a period of calm and consolidation, according to Emirates Steel, the largest integrated manufacturer of steel in the UAE. “There is still enthusiasm in the region as far as construction projects are concerned,” the Company said on the occasion of the Leaders in Construction Summit 2011, which was held at the prestigious Armani Hotel in Dubai. Emirates Steel was one of the sponsors of the Summit.
Held under the patronage of HH Sheikh Hamdan bin Mubarak Al Nahyan, Minister of Public Works, the Summit invited the construction sector’s most inspiring leaders to share their strategies for growth. “It is our view that infrastructure, oil and gas, power, and construction projects in the region will translate well in terms of profitability for regional contractors and developers in the coming few years,” said Mr. Mubarak Al Khaili, Emirates Steel’s Vice President of Commercial Strategy.
He believed that the region displays relatively unique characteristics, including decent demographics (see graph below), strong state budget surpluses fueled by high oil prices, muscular sovereign wealth funds and a drive to diversify economies. According to recent press reports, Saudi Arabia, the largest economy in the region, has earmarked US$ 500 billion worth of investment opportunities in energy, transportation, education, healthcare and other critical sectors of economic development. The Saudi construction sector is expected to maintain its upward momentum in the short to mid-term, the reports said.
The UAE, the second largest economy in the GCC, will continue to rapidly expand, unaffected by global recession and regional turmoil. Backed by vast reserves of natural gas, Qatar’s projects will encompass a wide spectrum of sectors, including building construction, leisure, tourism, and a particular focus on sports as it prepares to host the FIFA World Cup in 2022. In Kuwait, the construction sector is set for steady growth buoyed by the increasing demand for low-cost housing property from Kuwaiti nationals and the planned educational and healthcare projects. Oman’s government spending on projects in the oil and gas related sector is also expected to fuel more private sector investment in real estate, particularly in new industrial areas.
“The long term outlook for the construction industry is positive,” affirmed Mr. Al Khaili. The inaugural Leaders in Construction Summit 2011, held under the auspices of Construction Week and Arabian Business, uncovered how the captains of the construction industry are planning to tackle the coming 12 months. The Summit helped more than 150 of the region’s construction executives in sharing strategies, insights and plans for the year ahead.