DOHA: Qatar’s focus on infrastructure development will continue as per the country’s original plans. An estimated $21bn worth infrastructure projects are expected to be awarded in 2015 itself.
In Qatar, the two largest projects in pre-execution phase and expected to be awarded in 2015. They are from QRail, namely the “QIRP: Passenger & Freight Rail”, budgeted at $15bn, and from QIRP, whose “Passenger & Freight Rail: Phase 2” is budgeted at $3bn, audit and consulting firm Deloitte’s latest research note on GCC construction sector noted yesterday.
Another two mega projects which are expected to be awarded in 2015 are: one for the new Qatar Economic Zone budgeted at $3bn, which is one of the three new planned economic zones mainly focusing on logistics and air freight companies (expected to be the biggest of the three), and Occidental Petroleum Corporation (Oxy) – Idd e Shargi North Dome Expansion Phase 5, again budgeted for $3bn.
This year stands to be another key indicator of economic development as the Gulf Cooperation Council (GCC) continues to invest in infrastructure and capital projects. The forecast for projects planned and underway in the GCC in 2015 is $172bn; the highest on record to date. Deloitte Middle East’s annual report said.
According to the Deloitte report, key drivers for diversification include job creation given that 50 percent of the GCC population is under the age of 25. In Saudi Arabia alone it is forecast that four million jobs will be needed in the next five years. GCC population growth is forecast to grow from 350 million to 602 million by 2050, all driving the GCC countries’ strategies to provide education, healthcare, infrastructure and support to communities. This growth will require energy and water: a 34 percent increase in electricity generation capacity and a further 2.2 billion liters desalination capacity are required by 2020.
“The forecast of $ 172bn worth of projects are against a backdrop of lower oil prices, continuing political unrest and reduced International Monetary Fund (IMF) growth forecasts across the GCC,” said Cynthia Corby, audit partner and leader of the Construction industry for the Middle East.
“However the GCC countries have the benefit of reserves, which they have built up as a buffer and which they can continue to use to achieve their outlined strategies. Therefore, they are expected to continue to spend on infrastructure and capital projects in order to achieve their strategies for diversification of their economies.” she added.
On UAE, the report said the dwarfing infrastructure project of the region is of course DWC: Al Maktoum International Airport expansion, currently budgeted at $32bn and anticipated to be the biggest airport in the world. This is followed by a massive industrial project in Abu Dhabi for Tacaamol – Al-Gharbia Chemicals Industrial City, planned at $20bn.
There are other sectors with several billions being planned on capital projects, with the top sector for 2015 being mixed-use and residential projects amounting to $24bn.
