The GCC projects market recorded negative growth for the first time in 2016 according to MEED’s new Project Activity Monitor (PAM), which tracks the net gain of contract awards against completions.

For 2016 there was a net loss of $61bn as project completions greatly outpaced new awards. According to data from regional projects tracker MEED Projects there were $105bn of contract awards in the GCC during 2016, while at the same time there were $166bn of contracts that were completed.

The imbalance means that the market has contracted for the first time since contract award and completions data started to be collected by MEED in 2004. The worst performing year previously was 2012 when there was a net gain across the GCC of $14bn. The best ever performing year was 2006 when there was a net gain of $90bn. More recently, the best performing year was 2013 when there was a net gain of $69bn, this was followed in 2014 with $68bn. The number began to decrease further in 2015 with a net gain of $55bn before the sharp $116bn fall into negative territory 2016.

The market performed badly in 2016 because unlike previous years all major markets experienced negative growth. The only market that did achieve positive growth was the region’s smallest projects market, Bahrain, which recorded a net gain of $3.7bn.

The region’s largest markets - Saudi Arabia, the UAE and Qatar - were all strongly negative in 2016. Saudi Arabia was the worst performing market. It registered a net loss of $30bn, which was greater than the $27bn sum total of awards for the year. Qatar had a net loss of $13.5bn as the value of completions nearly doubled the $14.7bn of awards. The UAE has a net loss of $11bn.

One of the contributing factors to the net loss in 2016 was a fall in the number of big orders placed. It fell to a 10-year low during 2016 as low oil prices led to reduced investment in the oil and gas sector and governments and their related companies cut spending on infrastructure.

There were nine contracts awarded during 2016 that are valued at over $1bn, down significantly on the 25 $1bn-plus orders placed in 2015.