USD 12.9 Billion Worth Of Energy Projects Were Awarded In The GCC In Q1 2020 Registering A 53% QoQ Hike
The GCC construction market is estimated at USD 2.4 trillion, with over 23,000 active projects at the end of Q1 2020. BNC Network, the largest construction intelligence platform in the Middle East and North Africa (MENA), issued the 17th edition of the BNC Projects Journal titled: Code Blue. The latest BNC Projects Journal stated that the GCC construction market shifted focus towards driving ongoing projects to completion in Q1 2020 and was cautious in new announcements as well as contract awards. USD 48.4 billion worth of projects were completed in Q1 2020, driven by the UAE and Saudi Arabia with 38% and 27% contribution respectively.
“As COVID infects the global economy, no industry or business is truly immune. The obvious fallout in terms of delays due to the disruption to work on sites, material supply disruptions due to closed factories and shipping delays are symptoms of an economic disease that can and must be addressed,” said Avin Gidwani, CEO of Industry Networks.
New projects worth USD 21 billion were announced in Q1 2020 with the largest contribution being made by the UAE with 59% market share followed by Qatar and Oman.
“The economic malady affecting construction is clearly contagious but unlike the coronavirus, it spreads only when businesses break connections in the flow of commerce by breaking their commitments to pay.” mentioned Avin Gidwani. He added, “We must remember that this disease isn’t just testing our business acumen – it’s testing our humanity.”
The total value of contracts awarded in Q1 2020 was USD 23.5 billion, while USD 3.1 billion worth of contracts were awarded in March. The energy sector registered USD 12.9 billion worth of project awards in Q1 driven by the UAE and Saudi Arabia with 42% and 40% contribution respectively.
The GCC Construction sector registered a 4% YoY growth in March which was primarily driven by the energy sectors with oil & gas and the utility sector expanding by 16% and 7% YoY respectively. The industrial sector grew marginally by 4% YoY while the GCC transport sector contracted by 5% YoY.
