Construction in Saudi Arabia – Key Trends and Opportunities to 2023

2019-04-05
Price :
Published : Apr-2019
No. of Pages : 47

Construction in Saudi Arabia – Key Trends and Opportunities to 2023

Summary

Following three years of contraction, the Saudi Arabian construction industry is expected to recover in 2019, with the industry’s output expected to register a growth of 1.9% in real terms that year. This momentum is expected to continue throughout the forecast period (2019-2023), driven by a recovery in crude oil prices coupled with the government’s investment towards new oil and gas projects and sewage infrastructure. Furthermore, the government’s plan to develop transport infrastructure and affordable houses in the country is expected to support industry output over the forecast period.

In line with recovery in oil prices, the government is increasing its total budget spending, which in turn will support investment towards transport infrastructure, healthcare and educational buildings and residential buildings. In the 2019 budget, the government increased its total budget spending by 7.0%, going from SAR1.0 trillion (US$266.7 billion) in 2018 to SAR1.1 trillion (US$293.3 billion) in 2019. The government allocated SAR70.0 billion (US$18.7 billion) in its 2019 budget towards infrastructure and transportation – an increase of 28.0% compared to the 2018 budget allocation.

In January 2019, the government announced plans to attract SAR1.6 trillion (US$429.0 billion) of private investment under the National Industrial Development and Logistics Program (NIDLP) over the next 10 years. Under this, the government aims to develop the industrial and transport infrastructure of the country to diversify the country’s economy and reduce its reliance on the oil sector.

The industry’s output value in real terms recorded a compound annual growth rate (CAGR) of -1.39% during the review period (2014-2018), and is expected to post a forecast-period CAGR of 3.04%.

GlobalData’s “Construction in Saudi Arabia – Key Trends and Opportunities to 2023”, report provides detailed market analysis, information and insights into the Saudi Arabian construction industry, including –
– The Saudi Arabian construction industry’s growth prospects by market, project type and construction activity
– Critical insight into the impact of industry trends and issues, as well as an analysis of key risks and opportunities in the Saudi Arabian construction industry
– Analysis of the mega-project pipeline, focusing on development stages and participants, in addition to listings of major projects in the pipeline.

Key Highlights

– GlobalData expects the residential construction market to register a forecast-period CAGR of 4.62% in nominal terms, driven by the government plans to meet the rising demand of affordable houses in the country. In 2018, the government launched a loan-guarantee program with a total investment of SAR30.5 billion (US$8.2 billion). Of the total investment, the government plans to allocate SAR18 billion (US$4.8 billion) to provide housing loans to the low-and middle-income citizens in the country, and SAR12.5 billion (US$3.4 billion) to provide down payment support to economically weak home buyers by 2030.
– Forecast-period growth in the institutional construction market will be driven by the government’s focus on education and healthcare infrastructure. In the 2019 budget, the government increased its spending on the healthcare sector by 8.2%, going from SAR159.0 billion (US$42.4 billion) in 2018 to SAR172.0 billion (US$45.9 billion) in 2019. Furthermore, under the Vision 2030, the government plans to spend SAR23.0 billion (US$6.1 billion) to build new hospitals and other healthcare buildings in the country during 2017-2021.
– GlobalData expects the energy and utilities construction market to register a forecast-period CAGR of 6.47% in nominal terms, driven by the government aims to generate 10% of the total energy need from renewable sources by 2023. In March 2018, the government signed an agreement with Japan’s SoftBank Group Corp worth SAR750 billion (US$200 billion) to develop solar and wind energy infrastructure. Furthermore, under the National Renewable Energy Program, the government plans to invest SAR187.5 billion (US$50 billion) in order to develop 30 wind and solar energy projects by 2023.
– Industrial construction market’s forecast-period growth will be driven by the government’s plan to diversify its economy from oil and increase the performance of non-oil sectors. The government is focusing on the manufacturing sector in order to achieve sustainable economic growth and reduce dependency on the oil and gas sector. In December 2018, the government announced its plan to spend SAR200 billion (US$53 billion) under the Fiscal Balance Program to increase foreign direct investment in the manufacturing sector, as well as increase the number of Small and Medium Enterprises (SMEs) in the country by 2020.
– The total construction project pipeline in Saudi Arabia – as tracked by GlobalData, and including all mega projects with a value above US$25 million – stands at SAR3.7 trillion (US$977.4 billion). The pipeline, which includes all projects from pre-planning to execution, is skewed towards late-stage projects, with 71.4% of the pipeline value being in projects in the pre-execution and execution stages as of April 2019.

Scope

– This report provides a comprehensive analysis of the construction industry in Saudi Arabia.
– Historical (2014-2018) and forecast (2019-2023) valuations of the construction industry in Saudi Arabia, featuring details of key growth drivers.
– Segmentation by sector (commercial, industrial, infrastructure, energy and utilities, institutional and residential) and by sub-sector.

Reasons to buy

– Identify and evaluate market opportunities using GlobalData’s standardized valuation and forecasting methodologies.
– Assess market growth potential at a micro-level with over 600 time-series data forecasts.
– Understand the latest industry and market trends.
– Formulate and validate strategy using GlobalData’s critical and actionable insight.
– Assess business risks, including cost, regulatory and competitive pressures.
– Evaluate competitive risk and success factors.

Filed in: construction
Publisher : GlobalData
More Reports
Title Price Buy Now

Construction in Ukraine – Key Trends and Opportunities to 2023

Construction in Ukraine - Key Trends and Opportunities to 2023 Summary The Ukrainian construction industry registered an annual growth of 17.5% in real terms during 2016-2018, following an average annual contraction of 16.4% during 2014-2015. This was due to positive developments in economic conditions, and investments in transport infrastructure and energy and industrial construction projects. Additionally, government efforts to attract foreign investments, in order to develop the country's overall infrastructure, supported the industry's growth. The industry's output value is expected to continue to expand over the forecast period (2019-2023), with investments in infrastructure, health, education and manufacturing continuing to drive growth. In 2018, the government approved the Drive ......
$1495

Construction in Algeria – Key Trends and Opportunities to 2023

Construction in Algeria - Key Trends and Opportunities to 2023 Summary In real terms, the Algerian construction industry's output grew at a compound annual growth rate (CAGR) of 4.78% during the review period (2014-2018). Although output growth slowed marginally in 2017 and 2018 due to austerity measures implemented by the government and low oil prices, the general upward trend can be attributed to public and private sector investment in infrastructure, residential and energy construction projects. Over the forecast period (2019-2023), the industry's expansion will be supported by improvements in consumer and investor confidence, as well as positive developments in regional economic conditions. The government's efforts to enhance regional connectivity through the development of the coun......
$1495

Construction in the Philippines – Key Trends and Opportunities to 2023

Construction in the Philippines - Key Trends and Opportunities to 2023 Summary The Philippine construction industry registered a growth of 15.1% in real terms in 2018. This was preceded by an average annual growth of 9.6% during the preceding four years. Growth during the review period (2014-2018) was driven by positive developments in regional economic conditions and government investment in residential, transport and energy infrastructure. The industry's output value is expected to continue to expand in real terms over the forecast period (2019-2023), driven by the government's plans to upgrade the country's transport infrastructure. In addition, public and private sector investments in residential, commercial and educational infrastructure construction projects are expected to suppor......
$1495

Construction in Kuwait – Key Trends and Opportunities to 2023

Construction in Kuwait - Key Trends and Opportunities to 2023 Summary Kuwait's construction industry suffered a downturn for a third year in a row in 2018, where it contracted by 4.0% in real terms, preceded by annual declines of 1.4% and 0.4% in 2016 and 2017 respectively. This decline can be attributed to economic slowdown and a fall in oil prices, which worsened the business environment in the country. In October 2018, the country did not export any oil to the US for the first time in 25 years; this resulted in lower government earnings, which in turn reduced investments in construction projects. The industry's output value is expected to recover over the forecast period (2019-2023), with investments in transport infrastructure, energy and residential construction projects. The gover......
$1495

Construction in Australia – Key Trends and Opportunities by State and Territory to 2023

Construction in Australia - Key Trends and Opportunities by State and Territory to 2023 Summary Following a period of negative growth during 2014-2016, construction activities in Australia picked up sharply in the second quarter of 2017, with the last stage of work on the multi-billion Gorgon project providing a spurt, along with the ongoing work on the Wheatstone and the Ichthys Liquefied Natural Gas (LNG) projects. As a result, construction work grew by 8.1% and 31.5% in chain volume measures in the second and third quarter of 2017 respectively, and by 10.7% for the entire year. However, the construction industry suffered a downturn in 2018, contracting by an estimated 2.8% in real terms, reflecting a sharp drop in activity in the oil and gas sector as major projects were completed. T......
$1495

Global Construction Outlook to 2023 – Q1 2019 Update

Global Construction Outlook to 2023 - Q1 2019 Update Summary GlobalData expects the pace of global construction output growth to pick up in 2019, reaching 3.4% from 3.2% in 2018. The improvement is entirely owing to an acceleration in growth in construction activity in emerging markets, most notably in China, where the authorities are stepping up investment in infrastructure to prevent a continued slowdown. However, growth in China will drop back from 2021 onwards, and this will contribute to a slight easing in construction growth in emerging markets. The expansion in advanced economies will be fairly sluggish in 2019, with growth in North America slowing to 1.2%, and in Western Europe there will be a deceleration to 2.3%. However, over the remainder of the forecast period, there will b......
$4950

Construction in Tunisia – Key Trends and Opportunities to 2023

Construction in Tunisia - Key Trends and Opportunities to 2023 Summary Tunisia's construction industry recovered in 2018, and registered a growth rate of 1.0% in real terms, following a contraction of 1.8% in 2017. This recovery was driven by positive developments in economic conditions, revival in investor confidence and investments in transport infrastructure, energy and housing. Expansion in the tourism and manufacturing sectors also supported the industry's growth. Aid from financial institutions also helped in improving the investment climate; in 2017 and 2018, World Bank provided two loans, each worth TND1.3 billion (US$500.0 million), which supported the housing development and funding towards developmental projects in the country. The industry is expected to continue to expand o......
$1495

Construction in India – Key Trends and Opportunities to 2023

Construction in India - Key Trends and Opportunities to 2023 Summary India's construction industry regained growth momentum in 2018, with output expanding by 8.8% in real terms - up from 1.9% in 2017. This was driven by positive developments in economic conditions, improvement in investor confidence and investments in transport infrastructure, energy and housing projects. In the 2018-2019 budget, the government increased its expenditure towards infrastructure development by 20.9%, going from INR4.9 trillion (US$75.9 billion) in the Financial Year (FY) 2017-2018 to INR6.0 trillion (US$89.2 billion) in FY2018-2019. The industry is expected to continue to expand over the forecast period (2019-2023), driven by the government's efforts to develop the country's infrastructure and improve hous......
$1495

Construction in Qatar – Key Trends and Opportunities to 2023

Construction in Qatar - Key Trends and Opportunities to 2023 Summary In real terms, the Qatari construction industry registered a review-period (2014-2018) compound annual growth rate (CAGR) of 19.91%, supported by the government and private sector investment in transport infrastructure, energy and utilities, residential and healthcare buildings under the Qatar National Development Strategy 2011-2016. The industry is expected to grow at a CAGR of 13.17% over the forecast period (2019-2023) in real terms. Forecast-period growth will be supported by public and private sector investments in infrastructure construction projects and expansion in residential and commercial buildings projects. Furthermore, construction work related to the upcoming 2022 Fifa World Cup and Vision 2030 is expected......
$1495

Construction in the Czech Republic – Key Trends and Opportunities to 2023

Construction in the Czech Republic - Key Trends and Opportunities to 2023 Summary The Czech construction industry regained growth momentum in 2018, with output expanding by 6.9% in real terms - up from 2.8% in 2017. Growth during the review period (2014-2018) averaged 2.5% a year, and was supported by positive developments in regional economic conditions and government investments in transport, commercial, residential and industrial construction projects. The government's efforts to enhance transport, commercial and industrial infrastructure will support the growth of the industry over the forecast period (2019-2023). The industry's output is expected to be supported by improvements in business confidence over the forecast period, which will drive investment in infrastructure, commercia......
$1495
We use cookies to deliver the best possible experience on our website.
By continuing to use this site, or closing this box, you consent to our use of cookies. To learn more, visit our Privacy Policy