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Construction in Saudi Arabia - Key Trends and Opportunities to 2023

  • Published Date: 05 Apr 2019
  • Number of Pages: 47
  • Category: Construction
  • Country: Saudi Arabia
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 industrys 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 governments investment towards new oil and gas projects and sewage infrastructure. Furthermore, the governments 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 countrys economy and reduce its reliance on the oil sector.

The industrys 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%.

GlobalDatas "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 industrys 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 governments 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 Japans 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 markets forecast-period growth will be driven by the governments 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 GlobalDatas 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 GlobalDatas critical and actionable insight.
- Assess business risks, including cost, regulatory and competitive pressures.
- Evaluate competitive risk and success factors.
Publisher Name : GlobalData

1. EXECUTIVE SUMMARY
2. CONSTRUCTION OUTLOOK: AT-A-GLANCE
3. LATEST NEWS AND INDICATORS
4. KEY DRIVERS AND RISKS
4.1. Economic Performance
4.2. Political Environment
4.3. Demographics
4.4. Risk Profile
5. CONSTRUCTION OUTLOOK
5.1. All Construction
5.1.1. Outlook
5.1.2. Project analytics
5.2. Commercial Construction
5.2.1. Outlook
5.2.2. Project analytics
5.3. Industrial Construction
5.3.1. Outlook
5.3.2. Project analytics
5.4. Infrastructure Construction
5.4.1. Outlook
5.4.2. Project analytics
5.5. Energy and Utilities Construction
5.5.1. Outlook
5.5.2. Project analytics
5.6. Institutional Construction
5.6.1. Outlook
5.6.2. Project analytics
5.7. Residential Construction
5.7.1. Outlook
5.7.2. Project analytics
6. KEY INDUSTRY PARTICIPANTS
6.1. Contractors
6.2. Consultants
7. APPENDIX
7.1. What is this Report About?
7.2. Definitions
8. ABOUT GLOBALDATA
8.1. GlobalData at a Glance
8.2. GlobalData Construction
8.3. Disclaimer
8.4. Contact Us

List Of Tables


Table 1: Construction Outlook
Table 2: Saudi Arabia, Key Economic Indicators
Table 3: Saudi Arabia, Construction Output Value (nominal, SAR Million)
Table 4: Saudi Arabia, Construction Output Value (nominal, US$ Million)
Table 5: Saudi Arabia, Top Commercial Construction Projects by Value
Table 6: Saudi Arabia, Top Industrial Construction Projects by Value
Table 7: Saudi Arabia, Top Infrastructure Construction Projects by Value
Table 8: Saudi Arabia, Top Energy and Utilities Construction Projects by Value
Table 9: Saudi Arabia, Top Institutional Construction Projects by Value
Table 10: Saudi Arabia, Top Residential and Mixed-Use Construction Projects by Value
Table 11: Saudi Arabia, Key Contractors
Table 12: Saudi Arabia, Key Consultants
Table 13: GlobalData Construction Market Definitions
Table 14: Construction Risk Index Ratings and Scores

List Of Figures


Figure 1: Key Markets, Construction Output Growth Matrix and Risk Matrix
Figure 2: Saudi Arabia, Construction Projects Pipeline by Sector (SAR Billion)
Figure 3: Saudi Arabia, Risk Profile
Figure 4: Saudi Arabia, Risk Comparison
Figure 5: Saudi Arabia, Construction Output Value (Real, US$ billion, 2017 prices and exchange rate)
Figure 6: Saudi Arabia, Construction Output Value, Growth Matrix
Figure 7: Saudi Arabia, Construction Output Value, by Sector (SAR Million), 2014-2023
Figure 8: Saudi Arabia, Construction Projects Pipeline, Projected Annual Spending by Stage (SAR Million), 2018-2023
Figure 9: Saudi Arabia, Construction Projects Pipeline, Value by Stage (SAR Million)
Figure 10: Saudi Arabia, Commercial Construction Output by Project Type (SAR Million), 2014-2023
Figure 11: Saudi Arabia, Commercial Construction Projects Pipeline, Value by Stage (SAR Million)
Figure 12: Saudi Arabia, Commercial Construction Projects Pipeline, Projected Annual Spending by Stage (SAR Million), 2018-2023
Figure 13: Saudi Arabia, Industrial Construction Output by Project Type (SAR Million), 2014-2023
Figure 14: Saudi Arabia, Industrial Construction Projects Pipeline, Value by Stage (SAR Million)
Figure 15: Saudi Arabia, Industrial Construction Projects Pipeline, Projected Annual Spending by Stage (SAR Million), 2018-2023
Figure 16: Saudi Arabia, Infrastructure Construction Output by Project Type (SAR Million), 2014-2023
Figure 17: Saudi Arabia, Infrastructure Construction Projects Pipeline, Value by Stage (SAR Million)
Figure 18: Saudi Arabia, Infrastructure Construction Projects Pipeline, Projected Annual Spending by Stage (SAR Million), 2018-2023
Figure 19: Saudi Arabia, Energy and Utilities Construction Output by Project Type (SAR Million), 2014-2023
Figure 20: Saudi Arabia, Energy and Utilities Construction Projects Pipeline, Value by Stage (SAR Million)
Figure 21: Saudi Arabia, Energy and Utilities Construction Projects Pipeline, Projected Annual Spending by Stage (SAR Million), 2018-2023
Figure 22: Saudi Arabia, Institutional Construction Output by Project Type (SAR Million), 2014-2023
Figure 23: Saudi Arabia, Institutional Construction Projects Pipeline, Value by Stage (SAR Million)
Figure 24: Saudi Arabia, Institutional Construction Projects Pipeline, Projected Annual Spending by Stage (SAR Million), 2018-2023
Figure 25: Saudi Arabia, Residential Construction Output by Project Type (SAR Million), 2014-2023
Figure 26: Saudi Arabia, Residential Construction Projects Pipeline, Value by Stage (SAR Million)
Figure 27: Saudi Arabia, Residential Construction Projects Pipeline, Projected Annual Spending by Stage (SAR Million), 2018-2023
Figure 28: Saudi Arabia, Headquarters of Key Contractors (% of Total Project Pipeline)
Figure 29: Saudi Arabia, Headquarters of Foreign Contractors (% of Project Pipeline with Foreign Contractor)
Figure 30: Saudi Arabia, Headquarters of Key Consultants (% of Total Project Pipeline)
Figure 31: Saudi Arabia, Headquarters of Foreign Consultants (% of Project Pipeline with Foreign Consultants)

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