The predicted growth in infrastructure spending in the GCC threatens to drive up inflation, according to Alistair Kirk, head of infrastructure, industrial and utilities, Middle East at UK consultancy EC Harris.

Most the GCC countries are planning to invest billions into infrastructure and transport projects. EC Harris research estimates that spending on infrastructure will increase by $50bn every year for at least the next five years.

This will put “unprecedented” pressure on resources in the region, says Kirk, speaking at MEED’s Saudi Mega Projects conference in Riyadh.  

Increasing demand for resources could push inflation up to 16 to 20 per cent between 2016 and 2019.

To try to control inflation risks, Kirk advises that the forming of joint ventures should be encouraged when working on projects.

He also says a “coordinated approach” across the region, in terms of regional and national priorities, would help relieve the anticipated demand.