MEED Projects’ latest forecast reveals that value of contracts awarded in the GCC will significantly drop by 15% in 2016. The total value is predicted to be $140bn this year, compared with $165bn in 2015.
The estimation is based on 2,100 planned and un-awarded projects in the region.
Ed James, director of content and analysis at MEED Projects, said: “With oil prices hitting 11-year lows, there is no real surprise that project spending is forecast to fall in 2016. However, it does mean that it will be a tough 12 months for companies in the sector as the number of project opportunities is reduced.”
Country focus:
Saudi Arabia: The Kingdom will probably be the worst hit because of falling revenue as oil price drops. The contracts awarded will witness a drop of $10bn, to $40.7bn in 2016.
UAE: UAE will maintain continuing spending in the Dubai real estate and infrastructure sectors. Contracts will probably fall slightly to $36.5bn in 2016 from $37.4bn in 2015.
Kuwait: The country is the third largest projects market in the GCC with a high record of contracts worth $31.5bn in 2015. This year, it will fall to $24.3bn.
Qatar: Contract awards to fall by $7bn.
Oman: Comparatively a smaller market, Oman will maintain last year’s spending levels at $13.5bn
Bahrain: Similar to Oman, Bahrain will also maintain last year’s spending levels at $2.8bn.