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29 March 2024

UAE construction sector to see continued growth: Deloitte

UAE has 36 per cent of total construction projects in the region. (FILE)

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By Staff

The UAE has 36 per cent of total construction projects in the region, worth $958bn, and is expected to see its construction industry grow by a compound annual growth rate (CAGR) of 9.6 per cent between 2010 and 2014, according to Deloitte Middle East’s newly released GCC Powers of Construction 2010.

Saudi Arabia, Abu Dhabi and Qatar continue to be the GCC markets harbouring greatest potential for the construction industry, the report maintains.

Saudi Arabia, which currently has a 38 per cent share of the total construction projects in the region, is expected to launch contracts worth $86bn in 2011. Currently the kingdom has $624bn worth of projects planned or underway.

Qatar, with a smaller 15 per cent of total construction projects, is estimated to see its construction industry grow by a CAGR of 12 per cent over the same period, Deloitte said.

The major trends taking place within the GCC and examined in this year’s publication are: government spending, public infrastructure, going green, urban regeneration, transport infrastructure, and affordable housing.

“In this year’s GCC Powers of Construction report we can see a continuation of many of the trends that were born out of the global financial crisis,” said Omar Fahoum, Deloitte Middle East Chairman and Chief Executive.

“Prime among these has been the role of government in injecting funds in a bid to stimulate their economies. These funds are being used to target infrastructure and sustainable development, thereby directly benefiting the construction sector.”

As well as providing an overview of each GCC market, GCC Powers of Construction 2010 explores some of the thornier issues affecting the industry. “This year has been challenging for the GCC construction sector,” said Cynthia Corby, audit partner and construction industry leader at Deloitte in the UAE. 

“Contractors have had to face suspended or cancelled projects while coping with increased competition for new tenders. In the key markets of Saudi Arabia, Abu Dhabi and Qatar, this competition has been further sharpened by the entrance of international contractors looking for new opportunities.”