ABU DHABI: Infrastructure investments worth $1.1 trillion are envisaged on a range of high-profile projects in Saudi Arabia, a report said.
These include the Riyadh and Makkah metros, worth $23 billion and $7 billion, respectively, the King Abdul-Aziz International Airport expansion, costing $4 billion, the $3.3-billion Shuqaiq power plant and the $3.5-billion Kudai Towers mixed-use development in Makkah, added the latest Economic Update released by the National Bank of Kuwait (NBK).
As part of the kingdom’s plans to diversify its productive base, the government has been engaged in a number of initiatives directed at the real estate and small and medium enterprise (SME) sectors. In the former, the government is keen to increase both the supply and affordability of housing for nationals; homeownership levels of around 36 per cent are relatively low by international standards.
As well as launching a new housing construction programme of 500,000 new units in 2011, the authorities unveiled a new mortgage law in 2012 and stepped up their efforts to encourage real estate lending through the banking sector and specialised credit institutions (SCIs) such as the Real Estate Development Fund (REDF). Real estate loans disbursed by banks stood at $36 billion by the end of 2Q14, an increase of 26.5 per cent year on year (y/y), with the retail segment receiving 63 per cent of all real estate loans.
