Despite global economic challenges such as financial sector turmoil, high inflation, and ongoing global political instabilities, Kamco Invest reports that GCC project awards grew during the year’s first quarter.
The total value of GCC contracts awarded increased by 54.7% year-on-year in Q1 to $29.9B, with Saudi Arabia accounting for 44.6% of the awarded contracts. Kamco Invest notes that this was the second-highest quarterly project awards since the start of 2022, according to TradeArabia.
Except for Bahrain, all GCC project markets witnessed year-on-year growth in project awards during Q1-2023. Saudi Arabia remained the largest projects market in the GCC, with 17.9% growth in project awards during the quarter, reaching $13.3B compared to $11.3B last year.
The growth in Saudi Arabia’s contracts during the quarter was driven by Saudi Aramco’s bumper profits during FY-2022, which reached $161.1B, and the energy giant’s expected 20% capex growth during 2023 as it builds its long-term oil and gas production potential.
The report noted that Saudi Arabia, UAE, and Qatar represented 84.1% of the overall projects in the GCC. While the chemical sector saw the biggest increase in project value, GCC countries have invested in projects in the industrial sector to diversify their economies away from hydrocarbons.
For instance, Saudi Arabia plans to invest $453.2B in its National Industrial Development & Logistics Program by 2030, while the UAE forecasts its industrial sector’s GDP contribution to reach $81.7B by 2030. Kuwait has earmarked $100B for development through public-private partnerships.
